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The 7 Most Important Management Theories You Should Know

22 November 2022
The 7 Most Important Management Theories You Should Know

To be an effective manager, you must have a strong understanding of management theory. There are countless theories out there, but some are more important than others. This blog post will discuss the 7 most important management theories you should know. These theories will help you better manage your team and achieve success in your career.

The scientific management theory

In the early 20th century, a theory known as scientific management began to emerge in industrial workplaces. This theory, pioneered by Frederick Taylor, aimed to improve worker productivity by focusing on efficiency and accuracy throughout the workplace. At its core, scientific management is based on a division of labor; it seeks to break down complex tasks into more specific and specialized roles so that they can be carried out more quickly and with greater precision.

Taylor proposed an intensive data collection and analysis system to support this effort to identify areas that could benefit from a better organization or improved processes. The goal of focusing resources on these areas was to increase overall output while streamlining the work process. This approach has been adopted in many industries, such as manufacturing or customer service, where efficiency is critical.

Although its principles have since been revised over time to account for developments in technology and psychology, it remains an essential foundation in modern management theory.

The human relations movement

Since the dawn of human civilization, there has been a growing emphasis on bettering the relationships between people. This effort, known as the human relations movement, is based on the idea that developing better relationships between individuals and organizations can increase productivity and improve job satisfaction.

Over time, this approach has evolved substantially. The movement's early stages focused on improving communication between management and labor staff. Today, however, it also takes into consideration how technology can be used to streamline processes and how diverse teams can benefit from different perspectives.

In addition, the human relations movement encourages organizations to employ psychological approaches to employee-employer relationships that focus on understanding each other's needs. By fostering trust between organizational leaders and employees, an organization can create a culture of collaboration which in turn helps increase productivity. Moreover, team members learn to work together more effectively and efficiently through new developments, such as game-based training methods that reduce anxiety by placing everyone on equal footing during meetings.

Through continued progress in areas such as trust building, open communication, respect for diversity of thought, and leveraging technological advances—all championed by the human relations movement—organizations can continue down the path toward success while simultaneously having happier workers.

The Hawthorne effect

The Hawthorne effect refers to behavior changes resulting from the effects of observation. It is named after the famous Hawthorne studies conducted in the early twentieth century by researchers at Western Electric's Hawthorne plant. The main finding of these experiments was that when people were under constant observation, their output dramatically increased regardless of changes made to their working conditions or environment.

Such findings have subsequently been linked to numerous other research results and business-related decisions. For instance, they can help explain why customer service feedback is essential for businesses and why employees tend to work harder when they suspect they are being monitored. They can also help explain the phenomenon known as a "halo effect," wherein one good impression carries over into all future appearances.

Ultimately, understanding the Hawthorne effect can be especially beneficial for business owners and managers, who must consider its implications when forming policy or evaluating staff performance. In any case, it serves as an important reminder that our behavior often increases or decreases depending on how closely we feel we are being watched.

Theory X and Theory Y

Theory X and Theory Y are two theories of motivation that Douglas McGregor first proposed in 1960. While both approaches assume that employees dislike work and need to be coerced or controlled by managers, they differ in their perceptions of the best methods to achieve this.

Theory X assumes that employees are lazy and passionless and should be forced with rewards and punishments to perform tasks efficiently. On the other hand, Theory Y posits that if an employee is engaged in their job, then they will put in more effort; it emphasizes individual motivation over external coercion. Thus, theory X or theory Y can motivate them to succeed depending on how employers view their workforce. It is up to employers to decide which approach suits their employees - whether they think controlling through rewards and punishments works better than inspiring and encouraging diligence.

With proper implementation, either of these theories can help organizations realize better performance outcomes from their team members. When utilized appropriately, theory X and theory Y can lead to tremendous organizational success. Understanding the nuances between the two will be highly beneficial for those who need to make workplace employee motivation decisions.

McGregor's X-Y theory

Since its introduction in the 1960s, McGregor's X-Y theory of human motivation has been widely accepted in organizational behavior. Also known as the Theory of Human Motivation, it proposes that people have different motivators depending on their characteristics. It also asserts that individuals' work performance results from their intrinsic and extrinsic motivators.

According to this theory, people can be divided into two distinct categories: Type X, who are motivated by extrinsic rewards such as money or prestige, and Type Y, who are driven by intrinsic factors such as an internal sense of achievement or satisfaction from doing meaningful work. Type X employees view work primarily as a source of financial reward and prefer tangible incentives such as promotions or perks for motivation.

On the other hand, Type Y is driven by personal motivations and takes satisfaction from internal recognition like peer compliments or managerial acknowledgment. This theory provides valuable insights into how best to motivate different types within an organization, allowing employers to tailor their reward systems accordingly.

Overall, McGregor's X-Y theory is an essential framework for understanding human motivation and will enable organizations to maximize employee engagement through effective motivational strategies.

Frederick Taylor's principles of scientific management

Thanks to the pioneering work of Frederick Taylor in the early years of the 20th century, a whole new approach to managing goods and services was born. While the concept of dividing tasks into its parts had been around for many years, Taylor systematized it by specializing labor according to functions, creating standard times for each job, having rest breaks at regular intervals, and using stopwatches to measure performance.

By using scientifically based principles and methods of analysis, Taylor's scientific management system also relied on clearly defined rules and procedures to ensure efficiency and accuracy. In addition, he aimed to make sure that managers were correctly compensated for taking on additional skills or responsibilities.

Finally, he sought to create an environment in which employees felt valued so that they would be encouraged to offer their labor with goodwill. Overall, Taylor's systematic principles of scientific management not only revolutionized manufacturing processes but radically changed the structure and functioning of industrial workplaces by improving productivity while maintaining high morale levels.

Frederick Taylor's ideas of scientific management and efficiency were trendy in the early 1900s. However, as time went on, theorists began to realize that perhaps people weren't just machines that could be tweaked and optimized. The human relations movement was born from this realization, emphasizing communication, employee satisfaction, and teamwork.

Today, we know that both sets of theories have their value - after all, the Hawthorne effect tells us that people perform better when they feel like they're being watched or monitored. In conclusion, understanding these various management theories is essential for any modern manager. If you want to learn more about these concepts, join our fundamentals of management course today!

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Yu Payne
Blogger

Yu Payne is an American professional who believes in personal growth. After studying The Art & Science of Transformational from Erickson College, she continuously seeks out new trainings to improve herself. She has been producing content for the IIENSTITU Blog since 2021. Her work has been featured on various platforms, including but not limited to: ThriveGlobal, TinyBuddha, and Addicted2Success. Yu aspires to help others reach their full potential and live their best lives.

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