PREVIEW

Classical Theory vs. Human Relation Approach Theory Human Relation Approach Theories of Organizations Human Relations Theory The Hawthorne Studies McGregors Theory X and Theory Y Human Resources Theory Likerts Systems Theory (Four Systems of Management) Blake and Moutons (Blake and McCanse) Managerial Grid

Classical vs. Human Relation Approach

Classical theory approaches : Focused only on job and structure of organization Fulfilling only workers economic need increases productivity Considered workers as machine Only manager had the sole right for decision making neglecting lower management cooperation Result: Inability of employee to use control over work processes Lack of employee understanding about what is the purpose on their job Lack of sense of belonging with the organisation

Human Relation theories were developed to promote the concern for employees social and emotional needs and hence fulfill them to achieve the organizational goals.

Principles of Human Relations Theory

Human relations theory is characterized by a shift in emphasis from TASK to WORKER Go beyond physical contributions to include creative, cognitive, and emotional aspects of workers Workers communicate opinions, complaints, suggestions, and feelings to increase satisfaction and production Significance of informal organization that involves within formal organizational structure Emphasize teamwork with good communication, motivation Origins (Hawthorne Studies & McGregors Theory X and Theory Y)

Origins of Human Relations Theory

The Hawthorne Studies
Hawthorne Works of Western Electric Company
1924 Chicago Four Important Studies:Illumination Study (November 1924) Relay Assembly Test Room Study (1927-1932) Interviewing Program (1928-1930) Bank Wiring Room Observation Study (1931 - May 1932)

The Hawthorne Studies

Illumination Study (November 1924) The effect of different levels of illumination (lighting) on productivity of labour The brightness of the light was increased and decreased to find out the effect on the productivity of the test group Relay Assembly Test Room Study (1927-1932)

Two small groups of six female telephone relay assemblers were selected
Each group was kept in separate rooms Changes were made in working hours, rest periods, lunch breaks, etc
Interviewing Program (1928-1930) 21,000 employees were interviewed over a period of three years To find out reasons for increased productivity Bank Wiring Room Observation Study (November 1931 - May 1932) A group of 14 male workers in the bank wiring room were placed under observation for six months The researchers thought that the efficient workers would put pressure on the less efficient workers to complete the work

Hawthorne Studies - Implications

Illumination Study (November 1924) The productivity increased even when the level of illumination was decreased. It was concluded that factors other than light were also important. Relay Assembly Test Room Study (1927-1932) Output increased in both the control rooms. It was concluded that social relationship among workers, participation in decision making, etc. had a greater effect on productivity than working conditions. Interviewing Program (1928-1930) It was concluded that productivity can be increased if workers are allowed to talk freely about matters that are important to them Bank Wiring Room Observation Study (November 1931 - May 1932) It was found that the group established its own standards of output, and social pressure was used to achieve the standards of output

Taken together, these studies helped to document the powerful nature of social relations in the workplace and moved managers more toward the interpersonal aspects of organizing.

Hawthorne Studies - Criticisms

1. Lacks Validity 2. More Importance to Human Aspects 3. More Emphasis on Group Decision-making 4. Over Importance to Freedom of Workers

Theory X and Theory Y: Douglas McGregor

The eminent psychologist Douglas McGregor :

Presented the theories in article titled The Human side of Enterprise Two sets of employees based on the perception of human nature Theory X- traditional approach to the management Theory Y- professional approach to the management

Assumptions of Theory X
The average human being is inherently lazy by nature and desires to work as little as possible. He dislikes the work and will like to avoid it, if he can. He avoids accepting responsibility and prefers to be led or directed by some other.

He is self-centred and indifferent to organizational needs.

He has little ambition, dislikes responsibility, prefers to be led but wants security. He is not very intelligent and lacks creativity in solving organizational problems. He by nature resists to change of any type.

Theory X and Theory Y: Douglas McGregor

Assumptions of Theory Y
Work is as natural as play, provided the work environment is favourable. Work may act as a source of satisfaction or punishment. An average man is not really against doing work. People can be self-directed and creative at work if they are motivated properly. Self-control on the part of people is useful for achieving organizational goal. External control and threats of punishment alone do not bring out efforts towards organizational objectives. People have capacity to exercise imagination and creativity. People are not by nature passive or resistant to organizational needs. They have become so as a result of experience in organisations.

An average human being learns under proper conditions. He is also willing to accept responsibility.
The intellectual capacity of an average human being is utilised partially under the conditions of modern industrial life.

Theory X and Theory Y: Douglas McGregor

The assumptions in Theory X and Theory Y are fundamentally distinct. Theory X is static, rigid, conservative and pessimistic.

Theory Y is optimistic, dynamic, flexible and progressive.

Theory X gives more importance to external control imposed by the superior on the subordinate.

Theory Y suggests self direction and the integration of individual needs with organizational needs.

Human Resources Theory

Rensis Likerts Systems Theory (Four Systems of Management)
Rensis Likert and his associates studied the patterns and styles of managers for three decades at the University of Michigan, USA, and identified a four-fold model of management systems
System 1 - Exploitative Authoritative System 2 - Benevolent Authoritative

System 3 - Consultative
System 4 - Participative

System 1 - Exploitative Authoritative:

Responsibility lies in the hands of the people in upper level of management. The superior has no trust and confidence in subordinates. Decisions are imposed on subordinates Teamwork or communication is very little and the motivation is based on threats.

Likerts Systems Theory (Four Systems of Management)

System 2 - Benevolent Authoritative:
Responsibility lies at the managerial levels but not at the lower levels of the organizational hierarchy. The superior has condescending confidence and trust in subordinates Subordinates do not feel free to discuss things about the job with their superior. Teamwork or communication is very little and motivation is based on a system of rewards.

System 3 - Consultative:
Responsibility is spread widely through the organizational hierarchy. The superior has substantial but not complete confidence in subordinates. Some amount of discussion between the superior and subordinates. Fair amount of teamwork, and communication takes place vertically and horizontally. The motivation is based on rewards and involvement in the job.

System 4 - Participative:
Responsibility for achieving the organizational goals is widespread There is a high level of confidence that the superior has in his subordinates. There is a high level of teamwork, communication, and participation.

Blake and Moutons Managerial Grid

Robert Blake and Jane Mouton (1960s) proposed a graphic portrayal of leadership styles through a managerial grid

The grid depicted two dimensions of leader s behaviour, Concern for people (accommodating peoples needs and giving them priority) on y-axis and Concern for production(keeping tight schedules) on x-axis, with each dimension ranging from low (1) to high (9), Thus creating 81 different positions in which the leaders style may fall.

Blake and Moutons Managerial Grid

Impoverished Management (1, 1): Low Concern for employee Low productivity Task management (9, 1): Low Concern for employee High productivity through organisation Middle-of-the-Road (5, 5): Balance between concern for employee and productivity Country Club (1, 9): Highly concerned for employee Low productivity Team Management (9, 9): High employee concern High productivity

SUMMARY
Humanistic Theories of Organizations Human Relations Theory The Hawthorne Studies McGregors Theory X and Theory Y Human Resources Theory Likerts Systems Theory (Four Systems of Management) Blake and Moutons (Blake and McCanse) Managerial Grid The principles of human resources theory attempt to integrate the concern for production from classical theory with the concern for the worker from human relations theory -- more effective and satisfying!