Thursday 20 September 2012
Operations and
Production Management
Professor Robert Shaw
School of Management
Guangdong University of Foreign Studies
Thursday 20 September 2012
Today (Session 3)
1.
2.
Course arrangements
a.
Your email
b.
Proposed session dates and times – speak up if there are any problems
(Sue can help with this)
c.
Any problems?
Lecture:
The History of Operations Management Theory
3.
Skills development:
a.
Overview of skills that are relevant to OPM
b.
Approach to enquiry / topic / problem
c.
Basics of report production
This is a proposal – it is not certain yet
Session
Date
Time
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
Thursday 6 September
Thursday 13 September
Thursday 20 September
Thursday 27 September
Thursday 27 September
Thursday 11 October
Thursday 11 October
Thursday 18 October
Thursday 25 October
Thursday 25 October
Thursday 1 November
Thursday 1 November
Thursday 8 November
Thursday 8 November
Thursday 15 November
Thursday 22 November
Thursday 22 November
Thursday 29 November
8.30 - 9.50
8.30 - 9.50
8.30 - 9.50
8.30 - 9.50
14.00 - 15.20
8.30 - 9.50
14.00 - 15.20
8.30 - 9.50
8.30 - 9.50
14.00 - 15.20
8.30 - 9.50
14.00 - 15.20
8.30 - 9.50
14.00 - 15.20
8.30 - 9.50
8.30 - 9.50
14.00 - 15.20
8.30 - 9.50
Test 1
Test 2
CANCELLED FOR SPORTS
MAJOR ASSIGNMENT DUE
Lecture:
A history of management theory
1.
Purpose of this lecture
2.
Management theory for operations and
production management
3.
Evolution of management theory
4.
Major schools of thought
5.
Some key theorists
1
Purpose of this lecture
1.
To p r o v i d e a n o v e r v i e w o f k e y i d e a s i n m a n a g e m e n t
2.
To p l a c e t h e s e i d e a s i n t o a m e a n i n g f u l f r a m e w o r k o r
context
3.
To s h o w h o w a n d w h y m a n a g e m e n t t h e o r y h a s e v o l v e d
4.
To a c q u a i n t y o u w i t h s o m e o f t h e k e y t h e o r i s t s i n t h e
Western traditions of management
5.
To a s k w h a t i s t h e r e l e v a n c e o f W e s t e r n t h e o r y t o C h i n a
2
Management theory for OPM
Management theory almost always directed at OPM
Some specialist theories which do not concern us, for example,
marketing management, public policy management, portfolio
management (stocks /shares)
What is the place/situation of theories about HR?
Either Integral to OPM
Or
Somehow stand alone
3
Evolution of management
theory
Historical context - Key events
Technological advances (industrialisation)
Wars
Mobilisation of working people (unions, protests)
The development of purposes
Efficient production
Management and/or organisation of people
Technological innovation
Quality of lives
In the workplace
In society as a whole
Sustainability
Of businesses
Of government services
Of society
4
Major schools of thought
1.
Various ways that people have classified
groupings of management theory
2.
Some key terms you should know
Classical Schools of Management
One of the first schools of management
thought, the classical management theory,
developed during the Industrial Revolution
when new problems related to the factory
system began to appear. Managers were
unsure of how to train employees (many of
them non-English speaking immigrants) or
deal with increased labor dissatisfaction,
so they began to test solutions. As a result,
the classical management theory
developed from efforts to find the “one best
way” to perform and manage tasks. This
school of thought is made up of two
branches: classical scientific and classical
administrative, described in the following
sections.
Behavioral Management Theory
As management research continued in the
20th century, questions began to come up
regarding the interactions and motivations
of the individual within organizations.
Management principles developed during
the classical period were simply not useful
in dealing with many management
situations and could not explain the
behavior of individual employees. In short,
classical theory ignored employee
motivation and behavior. As a result, the
behavioral school was a natural outgrowth
of this revolutionary management
experiment.
Quantitative School of Management
During World War II, mathematicians,
physicists, and other scientists joined
together to solve military problems. The
quantitative school of management is a
result of the research conducted during
World War II. The quantitative approach to
management involves the use of
quantitative techniques, such as statistics,
information models, and computer
simulations, to improve decision making.
This school consists of several branches,
described in the following sections.
Contingency School of Management
The contingency school of management
can be summarized as an “it all depends”
approach. The appropriate management
actions and approaches depend on the
situation. Managers with a contingency
view use a flexible approach, draw on a
variety of theories and experiences, and
evaluate many options as they solve
problems.
Quality School of Management
The quality school of management is a
comprehensive concept for leading and
operating an organization, aimed at
continually improving performance by
focusing on customers while addressing
the needs of all stakeholders. In other
words, this concept focuses on managing
the total organization to deliver high quality
to customers.
Management in the Future
Modern management approaches respect
the classical, human resource, and
quantitative approaches to management.
However, successful managers recognize
that although each theoretical school has
limitations in its applications, each
approach also offers valuable insights that
can broaden a manager's options in
solving problems and achieving
organizational goals. Successful managers
work to extend these approaches to meet
the demands of a dynamic environment.
5
Key theorists
1.
Selection of important theorists
2.
For each:
a)
Who?
b)
When?
c)
Why? Who or what influenced them, their goals, concerns, purposes
d)
Key works (title, date)
e)
Their theory or key ideas
f)
Strengths of the theory / ideas
g)
Weaknesses of the theory / ideas
h)
Influence on others
The important theorists
Machiavelli
Fayol
Ta y l o r
Weber
Follett
Maslow
Drucker
Hofstede
Mintzberg
Senge
Machiavelli
The Mandrake is a satirical play by Italian Renaissance writer Niccolò Machiavelli. Its
tale of the corruption of Italian society was written while Machiavelli was in exile,
allegedly having plotted against the Medici.
Fayol
The man who believes workers should
talk!
Fayol
Fourteen principles
1.
Division of work
2.
Delegation of Authority
3.
Discipline
4.
Chain of commands
5.
Congenial workplace
6.
Interrelation between individual interests and
common organizational goals
7.
Compensation package
8.
Centralization
9.
Scalar chains
10.
Order
11.
Equity
12.
Job Guarantee
13.
Initiatives
14.
Team-Spirit or Esprit de corps.
1 5 .
Fayol
Elements of management
1.
Planning: creating a plan of action for the
future, determining the stages of the plan and
the technology necessary to implement it.
2.
Organizing: Once a plan of action is designed,
managers need to provide everything
necessary to carry it out; including raw
materials, tools, capital and human resources
3.
Command: Managers need to implement the
plan. They must have an understanding of the
strengths and weaknesses of their personnel.
4.
Coordination: High-level managers must work
to "harmonize" all the activities to facilitate
organizational success. Communication is the
prime coordinating mechanism.
5.
Control: The comparison of the activities of
the personnel to the plan of action, it is the
evaluation component of management.
Frederick Winslow Taylor
Born 1856
Died 1915 (age 59)
American
Educated in France and Germany
1878 machine shop laborer at Midvale Steel Works
Mechanical engineer
The founder of “scientific management” – the analysis of workflows to improve efficiency, particular
labour efficiency.
The efficiency movement
Three major works:
A Piece Rate System (1895)
Shop Management (1903)
The Principles of Scientific Management (1911)
Frederick Winslow Taylor
The four objectives of management under scientific management were as
follows:
1. The development of a science for each element of a man's work to
replace the old rule-of-thumb methods.
2. The scientific selection, training and development of workers instead of
allowing them to choose their own tasks and train themselves as best they
could.
3. The development of a spirit of hearty cooperation between workers and
management to ensure that work would be carried out in accordance with
scientifically devised procedures.
4. The division of work between workers and the management in almost
equal shares, each group taking over the work for which it is best fitted instead
of the former condition in which responsibility largely rested with the workers.
Self-evident in this philosophy are organizations arranged in a hierarchy,
systems of abstract rules and impersonal relationships between staff.
Taylor ’s framework for each organization
was:
1.
Clear delineation of authority
2.
Responsibility
3.
Separation of planning
from operations
4.
Incentive schemes for workers
5.
Management by exception
6.
Task specialization
Three assumptions underlying Taylor’s
work were:
The presence of a capitalist system and a
money economy, where companies in a
free market have as their main objective
the improvement of efficiency and the
maximization of profit;
The Protestant work ethic, that assumes
people will work hard and behave rationally
to maximize their own income, putting the
perceived requirements of their
organization before their own personal
objectives and goals;
That an increased size is desirable in order
to obtain the advantages of the division of
labor and specialization of tasks.
Max Weber
Born 1864, Prusia
Died 1920, Múnich
German philosopher, sociologist and political economist
Theory of Social and Economic Organization (1947)
Principles and Elements of Management - describe an ideal or pure
form of organizational structure (general policy and specific
commands
Focus on organizational structure
Worker should respect the “right” of managers to direct activities
dictated by organizational rules and procedures
Max Weber –
theory of bureaucracy
Bureaucracy allows for the optimal form of authority - “rational
authority”
Three types of Legitimate Authority
Traditional Authority - past customs; personal loyalty
Charismatic Authority - personal trust in
character and skills
Rational Authority - rational application of rules or laws
Max Weber –
theory of bureaucracy
Tenets of Bureaucracy
Rules
Specified sphere of competence
Hierarchy
Specialized Training
Workers do not own technology
No entitlement to “official position” by incumbent
Everything written down
Maintenance of “ideal type” - bureaucracy
Max Weber –
theory of bureaucracy
Application in the Modern Workplace
Large organizations guided by countless rules are
bureaucracies
Linked with inefficient, slow-moving organizations
Organizations have several characteristics of
bureaucracies
Mary Parker Follett
Born 1868, Massachestts
Denied a doctorate at Harvard because she was female
Died 1833
American psychologist, social worker and consultant
Main works
The Speaker of the House of Representatives (1896)
The New State (1918)
Creative Experience (1924)
Dynamic Administration (1942)
Mary Parker Follett
Maslow
Born
Died
Psychologist
Studied exemplary people, not those with problems
1954 Motivation and Personality
Peter Drucker
Born 1909 Vienna, Jewish parents
Educated University of Frankfurt
Tw o o f h i s b o o k s w e r e b a n n e d b y t h e N a z i P a r t y
Left Germany to work London, 1933
Naturalised US citizen 1943
Died 2002 California
W r i t e r, p r o f e s s o r o f m a n a g e m e n t , c o n s u l t a n t
Early work on General Motors, book The Concept of the Corporation
1959 - Coined the term “knowledge worker" and later in his life considered
knowledge worker productivity to be the next frontier of management.
1.
Decentralization and simplification. Drucker discounted the command and control model and
asserted that companies work best when they are decentralized. According to Drucker, corporations
tend to produce too many products, hire employees they don't need (when a better solution would be
outsourcing), and expand into economic sectors that they should avoid.
2.
The concept of "Knowledge Worker" in his 1959 book "The Landmarks of Tomorrow".Since then,
knowledge-based work has become increasingly important in businesses worldwide.
3.
The prediction of the death of the "Blue Collar" worker. A blue collar worker is a typical high school
dropout who was paid middle class wages with all benefits for assembling cars in Detroit. The
changing face of the US Auto Industry is a testimony to this prediction.
4.
The concept of what eventually came to be known as "outsourcing. He used the example of front
room and a back room of each business: A company should be engaged in only the front room
activities that are core to supporting its business. Back room activities should be handed over to other
companies, for whom these are the front room activities.
5.
The importance of the non-profit sector, which he calls the third sector (private sector and the
Government sector being the first two.) Non-Government Organizations (NGOs) play crucial roles in
countries around the world.
6.
A profound skepticism of macroeconomic theory. Drucker contended that economists of all schools
fail to explain significant aspects of modern economies.
7. Respect of the worker. Drucker believed that employees are assets and not liabilities. He taught that
knowledgeable workers are the essential ingredients of the modern economy. Central to this
philosophy is the view that people are an organization's most valuable resource, and that a manager's
job is both to prepare people to perform and give them freedom to do so.
8.
A belief in what he called "the sickness of government." Drucker made nonpartisan claims that
government is often unable or unwilling to provide new services that people need or want, though he
believed that this condition is not inherent to the form of government. The chapter "The Sickness of
Government"in his book The Age of Discontinuity formed the basis of New Public Management.
9.
The need for "planned abandonment." Businesses and governments have a natural human
tendency to cling to "yesterday's successes" rather than seeing when they are no longer useful.
10.
A belief that taking action without thinking is the cause of every failure.
11.
The need for community. Early in his career, Drucker predicted the "end of economic man" and
advocated the creation of a "plant community“ where an individual's social needs could be met. He
later acknowledged that the plant community never materialized, and by the 1980s, suggested that
volunteering in the nonprofit sector was the key to fostering a healthy society where people found a
sense of belonging and civic pride.
12.
The need to manage business by balancing a variety of needs and goals, rather than subordinating
an institution to a single value. This concept of management by objectives forms the keynote of his
1954 landmark The Practice of Management.
13.
A company's primary responsibility is to serve its customers. Profit is not the primary goal, but rather
an essential condition for the company's continued existence.
14.
A belief in the notion that great companies could stand among humankind's noblest inventions.
Hofstede
Next week!
Mintzberg
Next week!
Peter Senge
Next week!
End of the lecture
Here begins your SKILLS
development for the session.
Skills developed in this course
Basic skills for Operations and Production Management professional
(The skills of enquiry / research / problem solving)
1. Identification of an issue / research topic / problem
2. Refinement and definition of the issue / research topic / problem (often formulated as a questions)
3. Recognise the different kinds of questions
a) Scientific questions
b) Practical questions
c) Moral questions
4. Research online
a) Come to understand your question
b) Gain relevant information
5. Formulate your response to the question
6. Plan your writing
1. Structure (report format)
2. What to include
7. Write , re-write, re-write: writing is how you think
8. Check your spelling, grammar, paragraph structure, referencing
Your task for the week
Academic papers on Operations and Production Management
1.
We are learning to conduct research, step-by-step
2.
Study for the test. No email this week unless you
want to ask a question(shaw@porirua.net “OPM” in
subject line).