This document discusses several important management theories and approaches: - The human relations movement focused on social and psychological factors, unlike classical theorists who focused only on work. Theories discussed motivation, groups, and leadership. - Early motivation theorists like Maslow and McGregor developed needs hierarchy and assumptions (Theory X/Y) models to understand what drives human behavior. - Systems theory views organizations as open systems that receive inputs, convert them, and provide outputs to the environment, with feedback. Contingency approaches suggest the best structure depends on an organization's environment and circumstances.

1. Makerere University Business School
Strategic Management Course
MANAGEMENT THEORIES - 2

2. Human Relations and social psychological
schools
• These theorists were academics and social
scientists.
• They were concerned with the human factor
at work.
• This was contrary to the classical theorists,
who concentrated on work itself but not the
worker doing the job.
• They dealt with human motivation, group
relationship and leadership.
• A few motivation theories are mentioned here
after – broad topics (group behaviour and
leadership have been left out of this course).

3. Early motivation theorists
• Human motivation
– Processes by which people seek to satisfy
basic drives, perceived needs and personal
goals, which trigger human behaviour.
• Early theorists concentrated on motivation
contents (e.g drives, needs) – content theories
• Didn’t focus on process

4. Motivation basic model
Motivation has the following components
Physical /
Emotional
Behaviour Satisfaction /
Frustration
OutcomeResponseStimulus

5. Elton Mayo
• Was an Australian psychologist
• A researcher in occupational aspects,
– E.g fatigue, accidents, labour turn-over
• Conducted studies for Western Electrics, Chicago,
USA (Hawthorne studies)
• Studies were on the worker rather than work
• Employees were subjected varying physical
conditions and they didn’t affect productivity
• Focus was shifted to social aspects and they
related to behaviour and productivity

6. Mayo’s conclusion
• “Man is a social animal”
• Individual workers cannot be treated in
isolation
• Belonging to a group is more important than
monetary incentives and good physical
conditions
• Informal groups strongly influence workers’
behaviour

7. Abraham Maslow (1950 / 60s)
• Physiological needs: Need for food, sleep, sex,
e.t.c.
• Safety needs: Stable environment relatively free
from threats
• Love needs: Group status, affectionate relations
with others
• Esteem needs:Self respect, self-confidence
• Self-actualisation: Self-fulfilment

8. Maslow’s needs - continued
• That people tended to satisfy the above
needs systematically
• Main criticism on Maslow’s theory –
– Systematic movement up the hierarchy does
not seem to happen practically.
• Maslow’s theory, however, formed a
framework to analyse a variety of needs

9. D McGregor – Theory X and Theory Y
• Managers’ assumptions about employees
Theory X
• That employees are lazy, require coercion
and control
• Avoid responsibility, seek security
• Similar to a rational economic man
suggested by Schein & Adam Smith)
• Strongly related to scientific management

10. Theory Y
• Opposite of theory X
• That people like work
• They work as naturally as resting or playing
• They don’t have to be controlled coerced
– If committed to objectives
• They don’t only accept but seek responsibilities
• Similar to Maslow’s higher level needs and
Schein’s self-actualising man
• A blend of theory X & Y is more representative of
real life.

11. Later Motivation theories
Theory Z – The Japanese approach
W. Ouchi
• American exponent of Japanese approach,
with
• Attempts for western firms to adapt Japanese
style
• Based on success of Japanese manufacturing

12. Japanese success
• Efficient use of resources, especially people
Strong personnel-related factors
• Mutual trust – employees and management
• Employees’ royalty to organisations
• Non-specialised career paths – job rotation
• Shared decision making
• Long term performance appraisal
• Collective responsibility

13. Remarks on the approach
• Some Japanese features are not
transferable to west due to cultural issues
• The west needs to develop better the
employee factor, on top of technology
• Japanese engineering has “Taylorism”
leading to standard production controls but
with improved HR aspects.
Criticism
• Slow decision making
• Imprisoning lifetime employment

14. SYSTEMS & CONTINGENCY
APPROACHES
Organisations as systems
• Organisations are set up as open social systems.
• A system is a collection of inter-related parts, which
form some whole.
• Examples of systems are: the human body, a
communication network, and a social system.
• A system can be open or closed.
• An open system obtains inputs from and discharges
outputs to its environment.
• A closed system is self-supporting
• Social systems, including all organisations as
mentioned above, are open systems.

15. Characteristics of open systems
• They receive inputs or energy from the
environment
• They convert inputs into outputs
• They discharge outputs into the environment
• They are cyclic in nature.
• Exercise negative negative entropy.
• A stable system is self-adjusting to a steady state.
This is called negative feedback.
• Equifinality. Open systems do not have to achieve
their objectives in using one particular method.

16. Key variables in an organisation as
a system
• People – as individuals or groups
• Technology
• Organisation structures and
• Environment

17. People
Materials
e.t.c
Information
Finance
Production & Marketing
activities
Planning, organising &
control mechanisms
Research & Development
e.t.c
Products
Services
Ideas
Waste
INPUTS CONVERSION OUTPUTS
Feedback of information & results
Model of an organisation as an open system

18. Systems - continued
• A system consists of subsystems
• An organisation’s boundaries, which are often
invisible, are defined strategically by stating the
scope of its activities.
• Subsystems also have boundaries, which are called
interfaces.
• Some employees work at external boundaries in such
activities as:
– Capital raising, Purchasing and Customer interaction
• Internal boundary employees manage interfaces
• Some sub-systems tend to be relatively self-
contained – closed.

19. Contingency approaches
• Contingency builds on systems approach
• It recognises organisations to consist of
interdependent components:
– External environment, Technology and Human
skills and motivation
• Contingency approach suggests that
organisations should look for the most
appropriate combination of structural design
in a given environment.
• Initially suggested by two American
researchers at Harvard called Lawrence and
Lorsch (1967) and several others shortly
followed.

20. Modern approach to
management
• Current approaches to management are
more of management currently in practice
than mere mare management theory.
• Modern management background stems from
– Advances in technology, Increased competition
and expanding markets, especially from Asia,
– Increasing consumer expectations
– Improvements in communication,
– General globalisation making the world more inter-
connected than ever before.

21. Strategic management approach
• Organisations to clearly state a vision and
mission,
• Formulation of organisation objectives
• External environment analysis
• Organisation (internal) analysis
• Strategic choice and strategic implementation
• Managing change in and around the
organisation
• Developing and utilising new technology
• Developing and utilising skilled labour
• Creation of flexible structures but with relative
stability