Management Theories and Principles: A Comprehensive Analysis
Historical Background
Theory X suggests that people dislike work and, if possible, will avoid it. 1. People shun work.
Theory Y: suggests that physical and mental efforts devoted to work are as natural as play or rest.
Theory Z: (William Ouchi) arising during the Japanese boom of the 70s and 80s, posits a thesis inspired by Nipponization. This led to Total Quality Management (TQM), emphasizing continuous improvement as a permanent attitude.
Michael Porter deserves consideration for his Competitive Strategy (integrated analysis of customers, suppliers, competitors, and potential substitutes), incorporating an external analysis I call the value chain. It is a method to explore inner strengths and minimize weaknesses to create and maintain comparative advantages in the market.
Management Schools
Classical School
It focuses on the technical problem. It considers the division of labor as the essence of administration, where everything is planned and structured. It is impersonal, with a strong emphasis on the task.
Operations School
Emphasis on scientific management, whose goal is efficiency. It cares not only about work and production methods but also about the overall organizational structure. Concepts such as authority, responsibility, hierarchy, goals, and control are added. A variant of this school is the current ecological awareness and adaptability of the company to the environment. Empirical analysis is based on experience through case studies.
Behavioral School
Also called behavioral, it places the human being in the foreground, emphasizing work association and partnership in exchange for division.
Systematic School
The company is an organization based on decision-making, and its success depends on information. It follows from the theory of decisions based on the selection of alternatives and consumer theory with economic considerations, such as profit maximization and indifference curves.
Systems Theory School
Analogies between sciences are found here, with equivalences between physical and biological sciences and the social sciences of human behavior. Its discovery of viable open systems, the principles of synergy and resources, and the implementation of the second law of thermodynamics (entropy) to such systems represent a systemic transition from the chaotic.
Contingency School
Its basic statement is “if this happens, then I do that.” It emphasizes the functional relationship between certain terms and concepts along with appropriate management techniques to achieve a goal.
Contracts School
The company presents a set of explicit and implicit contracts between the various entities that interact within it.
Body as a Natural Phenomenon
Raising management as a universal, real, and natural living attitude brings the following conclusions:
i. Administration and social organization are distinct but interrelated. Administration is necessary for social organization, and the latter only makes sense when it allows for administrative action. Organization arises when a common goal cannot be achieved except by joint action.
ii. Administration is necessary when there is social organization. The need arises when individual targets are unattainable. Social organization is the setting or field of action for administration.
iii. Administration’s action is to create synergy for each particular social organization. This is a mechanism to achieve a structure to attain certain objectives.
In short, administration is understood as a modifier of synergy to survive and grow. Any social organization must alter its initial synergistic patterns, and that requires administration to make decisions and establish new synergies.
Management Functions
Management is a process in which different functions are performed in an order to meet the proposed objectives.
- Define what to do; determine the objective to be achieved.
- Determine the means to achieve the objective (the how).
- Set the goal and the means to achieve it; execute the action to achieve the objective.
- After execution, check whether the objective has been achieved.
This brings concepts such as:
Planning: What to do, discover influencing variables, and draw action plans (logistics).
Organizing: How to do it, gather the resources and elements to achieve the objective.
Leading: Steps followed in execution, operating structure, and undertaking the course.
Controlling: Status of feedback. This is where performance (leading) is compared with the plan (planning) to detect deviations and make corrections to both the plan and implementation.
Management Principles
These principles seek to explain administrative behavior according to their characteristics and social organization, making it possible to meet the target. They modify the subsystems.
a) Interdependence of parties: Its purpose is to create power to generate synergy.
b) Optimization of the objective of the parties naturally: Maximizing what is under our control.
c) Conflict between the parties: Parties compete with each other because their goals and resource needs may not align with the overall goal.
d) Survival of all: If a part of the organization is missing, it is at risk. All parties should be kept in operation.
e) Sub-optimization of parties: By sub-optimizing the parties, it is possible for all to survive and develop.
f) Improbability of all: The more complex, the more improbable.
g) Hierarchy between the parties (authority): One party must take responsibility.
h) Size of all (optimal size): Knowledge of the required size.
i) Adaptation of the whole and its parts: Absorption of changes in the environment, flexibility.
j) Consistency in all: An organization is created to remain, to last.
Summary of Administration
Management is a process that aims to achieve a predetermined objective. All business functions must be oriented toward the same goal in a coordinated and harmonious manner.
Management functions represent a dynamic, circular, indivisible, and uninterrupted process applied to various areas of the company. These functions are planning (to do), organizing (how), leading (to), and controlling (check). Coordination is considered the very essence of administration, not just one of its functions.
Early studies and investigations of administration as a science led to a somewhat materialistic conception of man, known as a formal theory of organization that cares more about the positions held by individuals (Theory X).
Theory Y arose as a reaction to the human relations movement with its dynamics of small groups, focusing mainly on the individual and the more or less informal groups in which they interact.