organizational theory


  • This was Taylor’s attempt to rationalize the individual worker by: 1. dividing work between managers and workers 2. providing an incentive system (based on performance) 3.
    scientifically trained workers 4. developing a science for each individual’s responsibilities 5. making sure work gets done on time/efficiently Problems arose out of scientific management.

  • Also, they believed that the study takes advantage of employees because it influences their emotions by making it seem as if they are satisfied and content, however it is
    merely a tool that is being used to further advance the productivity of the organization.

  • “[27] In reality, Weber believed that by using human logic in his system, organizations could achieve improvement of human condition in various workplaces.

  • “[11] The Hawthorne study suggested that employees have social and psychological needs along with economic needs in order to be motivated to complete their assigned tasks.

  • • Encouragement of managers to acquire minimal knowledge of behavioral sciences to be able to understand and improve the interactions between employees Criticism[edit] Critics
    believed that Mayo gave a lot of importance to the social side of the study rather than addressing the needs of an organization.

  • Formal Organization[edit] The concept of formal organization has been touched upon by a number of authors in the subject of organizational theory, such as Max Weber, whose
    bureaucratic models could be said to be an extension of the concept.

  • Results[edit] The Hawthorne studies helped conclude that “a human/social element operated in the workplace and that productivity increases were as much an outgrowth of group
    dynamics as of managerial demands and physical factors.

  • Contingency theory holds that an organization must try to maximize performance by minimizing the effects of various environmental and internal constraints,[1] and that the
    ability to navigate this requisite variety may depend upon the development of a range of response mechanisms.

  • [20] Weber claimed that bureaucracies are necessary to ensure the continued functioning of society, which has become drastically more modern and complex in the past century.

  • In addition, within an organization that operates under bureaucratic standards, the members will be better off due to the heavy regulation and detailed structure.

  • One characteristic that was meant to improve working conditions was his rule that “Organization follows hierarchical principle – subordinates follow orders or superiors, but
    have right of appeal (in contrast to more diffuse structure in traditional authority).

  • If we were to take one characteristic focusing on efficiency, it would seem like Weber is promoting unhealthy work conditions, when in fact, he wanted the complete opposite.

  • Rather than small groups such as families and churches being able to control these problems as they had in the past, new organizations and systems were required.

  • )[18] Efficiency and teleological arguments[edit] Weber believed that a bureaucracy consists of six specific characteristics: hierarchy of command, impersonality, written
    rules of conduct, advancement based on achievement, specialized division of labor, and efficiency.

  • [21] Furthermore, he claimed that without the structured organization of bureaucracy, our complex society would be much worse off, because society would act in an inefficient
    and wasteful way.

  • Overall, the historical and social context in which organizations arose in the United States allowed not only for the development of organizations, but also for their spread
    and growth.

  • Developments in theory[edit] As people implemented organizations over time, many researchers have experimented as to which organizational theory fits them best.

  • [29] Some individuals may regard Weber’s model as good way to run an organization.

  • [42] For many years, private companies have automatically been understood as part of the economy in the same way that political parties are considered a part of politics and
    museums are considered a part of art.

  • “[12] This theory was a response to the way employees were treated in companies and how they were deprived of their needs and ambitions.

  • “[12] The Hawthorne studies also concluded that although financial motives were important, social factors are just as important in defining the worker-productivity.

  • Because of the communication it may not be the most efficient, but Weber would argue that improved human conditions are more important than efficiency.

  • Highest efficiency, in theory, can be attained through pure work with no regard for the workers (for example, long hours with little pay), which is why oversimplification
    can be dangerous.

  • Knowledge of these rules can be viewed as expertise within the bureaucracy (these allow for the management of society).

  • Weber’s theory of bureaucracy claims that it is extremely efficient, and even goes as far as to claim that bureaucracy is the most efficient form of organization.

  • Though his theories include characteristics of a highly efficient organization, these characteristics are only meant to serve as a model of how a bureaucratic organization
    works, recognizing that the manifestation of that model in life differs from the pure model.

  • “[3] Organization theory cannot be described as an orderly progression of ideas or a unified body of knowledge in which each development builds carefully on and extends the
    one before it.

  • Weber argued that in a bureaucracy, taking on a position or office signifies an assumption of specific duties necessary for the smooth running of the organization.

  • [7] These conditions made for a wage-dependent population that sought out jobs in growing organizations, leading to a shift away from individual and family production.

  • According to Cyert and March, organizations actually often operate with more values in their everyday behavior.

  • • Positions within a bureaucratic organization must follow a specific set of general rules.

  • Also, it rarely takes into consideration human error or the variability of work performances (since each worker is different).

  • Although this theory of modernization seemed to pride itself on only the benefits, countries in the Middle East saw this movement in a different light.

  • • When the office is developed/established it requires the full working capacity of individuals.

  • • People who work within a bureaucracy are usually trained in the appropriate field of specialization.

  • Another may see workers rejecting the incentive system because they are required to constantly work at their optimum level, an expectation that may be unrealistic.

  • In the early 20th century, theories of organizations initially took a rational perspective but have since become more diverse.

  • [36] According to Smith, the division of labor is efficient for three reasons: (a) occupational specialization, (b) savings from not changing tasks, and (c) machines augmenting
    human labor.

  • Markets that were quickly growing needed workers urgently, so a need developed for organizational structures to guide and support those new workers.

  • Rather, developments in theory and descriptions for practice show disagreement about the purposes and uses of a theory of organization, the issues to which it should address
    itself (such as supervisory style and organizational culture), and the concepts and variables that should enter into such a theory.

  • This differs from informal organization, such as a human group, that consists of individuals and their interactions, but do not require these to be coordinated toward some
    common purpose, although formal organizations also consist of informal organizations, as sub-parts of their system.

  • [10] A number of sociologists and psychologists made major contributions to the study of the neoclassical perspective, which is also known as the human relations school of

  • [27][28][30] Rational system perspective A rational organization system has two significant parts: (1) specificity of goals and (2) formalization.

  • [9] The classical perspective emerges from the Industrial Revolution in the private sector and the need for improved public administration in the public sector.

  • “Relay Assembly Test Room experiment (1927–28) to find out the effect of changes in number of work hour and related working condition on worker productivity.”

  • Wage dependency, externalities, and growth of industries all played into the change from individual, family, and small-group production and regulation to large organizations
    and structure.

  • [16] Although the classical perspective encourages efficiency, it is often[quantify] criticized as ignoring human needs.

  • If ‘tenure for life’ or a ‘right to the office’ develops, there is a decrease in career opportunities for ambitious new hires and overall technical efficiency becomes less

  • [39]: 117  However, the rationalist worldview counters the use of cultural values in organizations, stating, “transcendental economic laws exist, that existing organizational
    structures must be functional under the parameters of those laws, [and] that the environment will eliminate organizations that adopt non-efficient solutions.

  • “Experiment in interviewing Working: In 1928, a number of researchers went directly to workers, kept the variables of previous experiment aside, and talked about what was,
    in their opinion, important to them.

  • [22] A consequence is oligarchy, whereby a limited number of officials gain political and economic power.

  • [6] With this large growth came the need for organizations and for leadership that was not previously needed in small businesses and firms.

  • In a rational organization system, there are two significant parts: Specificity of Goals and Formalization.

  • “[14] Since bureaucracy requires sustained revenues from taxation or private profits in order to be maintained, a money economy is the most rational way to ensure its continued

  • Not only does bureaucracy make it much more difficult for arbitrary and unfair personal favors to be carried out, it also means that promotions and hiring will generally be
    done completely by merit.

  • [24] Weber’s analysis led him to believe that bureaucracies are too inherently limiting of individual human freedom.

  • [6] These organizations were less personal, more distant, and more centralized, but what they lacked in locality they made up for in efficiency.

  • [39][38]: 3 [need quotation to verify] After the 1950s, Western culture utilized mass-media to communicate their good fortune—attributed to modernization.

  • [6] Along with wage dependency and externalities, the growth of industry also played a large role in the development of organizations.

  • Thus, the modernity of organizations is to generate maximum profit, through the use of mass media, technological innovations, and social innovations in order to effectively
    allocate resources for the betterment of the global economy.

  • Organizational theory also concerns understanding how groups of individuals behave, which may differ from the behavior of an individual.

  • When high-skilled employees are necessary for the bureaucracy and public opinion shapes decision-making, competent officers are more likely to be selected.

  • They cannot assist employees of different parts of the system.

  • [citation needed] For the ensuing decade, people analyzed the diffusion of technological innovations within Western society and the communication that helped it disperse globally.

  • They said that organizations rarely operate with only one value.


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