Basics

Fundamentals of Management and how it works.

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Management is present in all aspects of life; in a company, factory, ministry, or hospital, also within the family, and in all countries where there is an economic activity, there is management. In other words, for any activity, there must be an administrator for it, so the health activity must have a health administration, and the educational activity must have an educational administration, thus if an organization cannot apply the principles of management, it will not achieve its goals. Every organization has had a goal since its establishment, and management seeks to achieve this goal.

What is management?

Management is an activity practiced by every manager at all levels. This activity aims to optimize the use of both material and human resources that exist in the facility in order to achieve the objectives set for it with the maximum possible efficiency and at the lowest cost.

What is the history of management and how did it develop?

Before the beginning of the twentieth century, there were no basic principles of management, however, it was based on the principle of trial and error and reliance on personal experience (the personal experience of the decision-maker) although those who make the decision are assistants to the manager and may participate with them in decision-making, the president or manager is the one who has the right to make a decision, and at this stage managers relied on personal experience based on the trial and error approach.

Since 1900, the beginning of the twentieth century, with the tremendous economic, political, social, and technological progress, there has become an awareness of the threat of the administration’s reliance on trial and error, and the trial and error method has become a great risk and must have a scientific basis.

Stages of management development:

Management today is not the same as it was decades ago. There has been a great development in it. The management that is being studied and practiced today is not the same that was taught twenty years ago.

  • The stage of scientific management (1900-1930):

At the beginning of the twentieth century, this stage began to appear in the United States in 1900, and it was called the “Scientific Management”. It was established by a group of practitioners who collected all the successful practices related to the trial and error stage then laid down a set of principles and scientific foundations for management with the goal of increasing production and increasing productivity and thus increase profits and thus increase the employees’ share of profits.

They set a strict management system based on a set of basic principles for each organization that has specific goals during a certain period of time. The administration was contractual. There was no labor law, also there was no system that protected the rights of workers or regulations specifying their rights and responsibilities.

This stage began in the United States then transferred to France and then to Europe, still and all, the United States is the leading country in management.

The (hire and fire) model which set specific goals for the individual, was for evaluating the employee’s performance. That model was simple that the company announces jobs and a number of applicants apply for it. The selected applicant signs a contract that is renewed annually three months before its expiry with the consent of the two parties, and upon renewal, either an increase or a decrease in salary or termination of the contract. This system lasted for 30 years and productivity increased as well as production and profits which increased wages and bonuses.

  • The stage of human relations (1930-1950):

At the end of the twenties in 1927, a great administrative revolution occurred among management society.

The supporters of this approach see that scientific management is not scientific because it was concerned with one element, which is work and neglected the most important element, which is the human resource. Thus, they should study the human being as a valuable resource and know his needs and motives in addition to knowing how management works to meet these needs and to ignite these motives through conducting an applied study to find out what is meant by human relations.

• A research team conducted an experiment in a factory for electrical appliances in the city of Thoron. The experimental approach was based on three stages using the experimental method:

Stage (1) describes the current situation (portraying the situation).

Stage (2) assessment of the situation (determining right and wrong).

Stage (3) Suggestions of solutions.

The team chose a working place with a thousand workers, then assessed the situation in terms of lighting, ventilation, supervision, hygiene, and the business model used inside the factory, however, they found many negative aspects. After that, they set up a new place for the experiment avoiding all negative aspects which were detected in the evaluation, then they measured and compared the productivity in the old and the new place.

They found that the changes that the worker felt in the new clean and organized place, helped to increase productivity, so they took care of workers’ transportation and health care (the health insurance system), social (social service office), working women (nurseries) and other humanitarian matters Which had the effect of increasing production.

This stage reached stability in productivity followed by an observable decrease when the third stage began.

  • The stage of the integrated managerial process (1950-till now):

The principles of this stage have been set to manage both material human elements through setting a set of basics for management to apply them in order to create a balance between material and human resources.

Integrated management process is an activity practiced by every president or manager at all levels, and this activity aims at the optimal use of both material and human resources that exist in any of the organizations in order to enable it to achieve the objectives set for it with the largest possible capacity at the lowest possible costs.

Conclusion:

The first stage: concerned with the optimal use of material resources and neglected the human element.

The second stage: focused on the human element at the expense of physical resources.

The third stage: The administrative process concerned itself with balancing and reaching the optimum use of both human and material resources and at the same time.

Management functions:

Most management experts agree that there are five basic functions of management, which are:

  1. Planning.
  2. Organizing.
  3. Developing technical and administrative competencies.
  4. Guidance and supervision (administrative leadership).
  5. Monitoring, follow-up and performance appraisal.

There are other functions that are considered functions of the organization or the facility:

  1. Production.
  2. Marketing.
  3. Financing.
  4. Human Resources management.
  5. Procurement.
  6. Warehouse management.
  7. Public Relations.

What are the organization’s goals?

  1. Increasing sales.
  2. Increasing profits.
  3. Supporting the financial status.
  4. Expanding the company’s market share.
  5. Supporting the competitive position.
  6. Production development.

Qualities of the manager:

  • The necessity of comprehensive knowledge of all principles and assets of management, bearing in mind that the higher the administrative ladder from the bottom to the top, this leads to an increase in administrative work and a decrease in technical work.
  • That the manager is able to transfer that scientific knowledge about management to the reality of actual practical application in all management situations that the manager is exposed to.
  • The need for this manager to be characterized by a set of characteristics and personal traits that qualify him to occupy this leadership position.

 Quantitative management approach:

A group of mathematicians, statisticians, and operations research scientists criticized the administrative process and set mathematical and statistical rules and foundations for decision-making that give predictions for the future, which are data in the past and present to predict the future through mathematical equations.

This approach concluded that the administration should not be traditional, that mathematical and statistical methods should be used to make the most appropriate decision with the greatest return and the lowest cost.

The quantitative approach began in 1965, and it grew and spread due to the development of computers, which greatly helped to collect, record, and arrange data to facilitate administrative processes.

The behavioral approach:

From 1965 until now, a new approach appeared, called the “Behavioral Approach” in management. It began studying human behavior and is divided into three basic sciences:

  1. Psychology.
  2. Sociology.
  3. Anthropology.

Behavioral sciences reflected on management, and there was a kind of integration between studying management and the human being along with analyzing the behavior of individuals with the aim of developing and refining their behavior which is the main goal of studying behavioral sciences and their impact on management.

Operations research:

This approach arose in the army in World War I in 1914. It is based on that any decision taken must use mathematical, computational, and statistical methods, for example (PERT model). It started by collecting data from World War I in 1914 until 1926 to analyze the results of it through mathematical methods.

The United States of America was the first to apply operations research in business, hence developing an operations research approach in management.

Modern trends in management:

  1. Total quality management
  2. Crisis management
  3. Conflict management
  4. Transparency
  5. Accountability
  6. Administrative Empowerment
  7. Management Governance
  8. Globalization and future challenges
  9. Administrative Re-engineering
  10. Innovation and knowledge management
  11. Strategic Management
  12. Learning organizations
  13. Self-managed work teams.

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