﻿1 00:00:26,680 --> 00:00:33,680 The session today is going to be devoted on - what the projection here says - theories 2 00:00:33,770 --> 00:00:40,770 and major schools of thought and framework of organizational analysis. We had so far 3 00:00:43,989 --> 00:00:50,989 discussion on two components of the course: one was the nature of the subject, its scope, 4 00:00:53,710 --> 00:00:59,780 what the contents are and what the features of the subject matter are. It is necessary 5 00:00:59,780 --> 00:01:04,479 to understand this to appreciate the topics which follow. 6 00:01:04,479 --> 00:01:11,479 We then went into a discussion on the legacy factors of any situation and we came to the 7 00:01:12,940 --> 00:01:18,920 conclusion that anything which exists has a certain set of givens. There is nothing, 8 00:01:18,920 --> 00:01:25,600 which exists without a set of givens. So, putting it in quantitative terms, y is never 9 00:01:25,600 --> 00:01:32,600 equal to m x, it is always y is equal to m x plus c. This c variable which needs to be 10 00:01:34,610 --> 00:01:41,610 decomposed for the understanding of what is a positive trait, what is a positive potential, 11 00:01:43,530 --> 00:01:49,010 what is a negative legacy, what is a dead weight and what needs to be eliminated. This 12 00:01:49,010 --> 00:01:54,280 applies to individuals, this applies to organizations and this is a reality of life, which cannot 13 00:01:54,280 --> 00:02:00,840 be wished away. We also analyzed how the study of longitudinal 14 00:02:00,840 --> 00:02:07,060 syncing is a serious discipline in its own right and how many different people, how many 15 00:02:07,060 --> 00:02:14,060 different scholars have researched on it in different territories and what is roughly 16 00:02:15,090 --> 00:02:21,709 the benchmark of assumptions, theories, practices in longitudinal thinking and it is nothing 17 00:02:21,709 --> 00:02:28,480 new in the subject area. I want to take the discussion forward today to discuss with you, 18 00:02:28,480 --> 00:02:32,870 as the subject says theories and major schools of thought. 19 00:02:32,870 --> 00:02:39,870 Now, what is a theory? We shall get into a definitional analysis in a short while but, 20 00:02:40,160 --> 00:02:47,160 to get the ball going, let us recognize that we all have our theories. A theory is a set 21 00:02:49,630 --> 00:02:56,630 of assumptions, which helps us to understand a reality. You do not have to be professionally 22 00:02:57,690 --> 00:03:04,690 trained to develop a theory, everyone wants to understand things around him and as he 23 00:03:07,720 --> 00:03:14,720 experiences things, he develops a theory. Now, if you do it scientifically, you develop 24 00:03:14,930 --> 00:03:21,370 a theory which is sustainable. If you do it by hunches like an amateur, well then obviously, 25 00:03:21,370 --> 00:03:28,370 you get the bumps of hunches and being an amateur, but everyone has a theory. Many of 26 00:03:32,139 --> 00:03:39,139 us believe that all men are honest, many of us believe all men are dishonest, many of 27 00:03:40,090 --> 00:03:45,519 us believe if you give some money to someone he will not return it, others say, no it is 28 00:03:45,519 --> 00:03:51,370 not like that. We all have a theory on everything behavior, 29 00:03:51,370 --> 00:03:58,370 ethics, profession. You choose a subject based on a theory, being a mechanical engineer is 30 00:03:59,829 --> 00:04:06,790 wonderful these days or being an electronics engineer, there is nothing to prove it. 31 00:04:06,790 --> 00:04:13,790 What is more, 4 years down the line it may not be anything like what you believe. People 32 00:04:15,000 --> 00:04:21,320 presume that 2 years of work in MBA, will make them - a specialization will emerge; 33 00:04:21,320 --> 00:04:27,470 it is one of those theories which has got no basis. After 2 years of study in MBA you 34 00:04:27,470 --> 00:04:32,540 will be barely literate to start understanding the subject matter and if you think doing 35 00:04:32,540 --> 00:04:39,540 finance with IT is a great specialization and you will get a great job, you will find 36 00:04:41,810 --> 00:04:42,060 out. 37 00:04:41,830 --> 00:04:47,979 Who knows what will be the job market 2 years down the line but, then you try to understand 38 00:04:47,979 --> 00:04:54,220 what is going around you, you develop a theory. Everyone starts studying finance with IT, 39 00:04:54,220 --> 00:04:59,479 you never understood finance, still less understood IT, combining it is even more complicated 40 00:04:59,479 --> 00:05:04,960 believe me, you will never get a job because of the courses which we have done and you 41 00:05:04,960 --> 00:05:11,340 will get a job because of the capabilities which you have. 42 00:05:11,340 --> 00:05:15,650 What you done is a capability then all of you engineers who start doing management should 43 00:05:15,650 --> 00:05:21,060 be similarly, incapable of doing any management. You can see how many loopholes there are to 44 00:05:21,060 --> 00:05:28,060 that theory but, yet you will take your decisions based upon that theory. So, theory becomes 45 00:05:28,490 --> 00:05:35,490 very important. To put it an everyday parlance therefore, theory is a set of assumptions, 46 00:05:38,110 --> 00:05:43,240 which helps you to read beading into a randomness of life. 47 00:05:43,240 --> 00:05:50,240 Now, I am giving you a working definition of theory. When you start reading meaning 48 00:05:51,400 --> 00:05:58,400 in to what is happening around you; you develop a theory, how true that theory is will not 49 00:06:01,159 --> 00:06:08,159 be known till it is tested. So, there is a difference between a theory and a theorem. 50 00:06:11,860 --> 00:06:18,860 Why do you say, Q E D which means I have proved what I had set out to prove. What era demonstrandum? 51 00:06:22,639 --> 00:06:29,639 It is the Latin, to understand therefore, the complexities of organization management 52 00:06:31,340 --> 00:06:38,340 over a period of time, different generations of scholars have generated different theories. 53 00:06:40,050 --> 00:06:46,069 The sensible way of understanding a subject matter is, not to start with developing your 54 00:06:46,069 --> 00:06:53,069 own theory but, to start with understanding what the existing theories are, am I right? 55 00:06:55,919 --> 00:07:00,819 You do not create a world because you believe that is the way the world should be created. 56 00:07:00,819 --> 00:07:07,590 You first understand how people talk of the world being created. There is one theory which 57 00:07:07,590 --> 00:07:12,629 says, god created something out of nothing, it is a theory. 58 00:07:12,629 --> 00:07:18,909 There is another which says, there was a big bang theory. Nobody was around when the so 59 00:07:18,909 --> 00:07:25,909 called big bang took place; then there is the theory which says [FL] there is no matter 60 00:07:28,189 --> 00:07:32,370 without abstraction and there is no abstraction without a matter; abstraction meaning energy 61 00:07:32,370 --> 00:07:39,370 and that is [FL] for you. It says very simply mass and energy is interchangeable. 62 00:07:42,069 --> 00:07:47,860 There is no matter which does not have its counter parted energy and there is no energy 63 00:07:47,860 --> 00:07:54,860 which will not have its counter parted matter and at the theory. Also organization management 64 00:07:57,139 --> 00:08:04,139 has its theories. Obviously, there is no one theory, different people have come up with 65 00:08:05,439 --> 00:08:10,090 different theories and they have all tried to reason it out. Through this session, we 66 00:08:10,090 --> 00:08:15,809 will revoke you through some of the leading theories of organization management. 67 00:08:15,809 --> 00:08:20,300 It is not as if these are the only theories which exist, it is not as if these theories 68 00:08:20,300 --> 00:08:27,300 cannot be argued with, it is not as if these theories are mathematically established. There 69 00:08:27,719 --> 00:08:34,719 is a world of difference between a mathematical theory, a theory of physics and a theory of 70 00:08:36,789 --> 00:08:43,789 management. Though you must realize even theory is in physics are riddled with arguments and 71 00:08:48,290 --> 00:08:55,290 they can be demolished. The most common example is, there was a theory that atom is the smallest 72 00:08:57,050 --> 00:09:03,639 element which cannot be broken up. They lived with that theory for decades and then they 73 00:09:03,639 --> 00:09:09,589 realized atom can be broken up, so what did they do? They did not rename atom; atom remained 74 00:09:09,589 --> 00:09:16,589 atom, but the theory was gone. There is linearity in theories which science 75 00:09:18,720 --> 00:09:25,720 subjects talk about. There is also a sequence of theories in management, but there is a 76 00:09:28,459 --> 00:09:35,459 difference between linearity and sequence. Linearity is a cause on an effect change, 77 00:09:37,850 --> 00:09:44,850 there was this theory which says, atom is the smallest element in matter which cannot 78 00:09:46,709 --> 00:09:53,709 be broken up then, the theory which says, an atom can be split, so there is linearity 79 00:09:57,120 --> 00:09:59,300 in that. 80 00:09:59,300 --> 00:10:06,300 Sequence is what came after what chronologically and the interesting thing in social sciences 81 00:10:07,110 --> 00:10:14,110 is you can have similar theories propounded in different geographies parallelly without 82 00:10:21,000 --> 00:10:28,000 drawing upon each other. Let me repeat that so that you understand its significance. There 83 00:10:28,350 --> 00:10:35,350 can be parallel theories or indeed, similar theories in different geographies in different 84 00:10:38,550 --> 00:10:45,550 parts of the world without any correlation. So, note as if linearity is essential in a 85 00:10:52,649 --> 00:10:59,470 theory in management, having explained to you some of the basic approaches to the understanding 86 00:10:59,470 --> 00:11:03,100 of the theory. Let me walk you through some of the theories 87 00:11:03,100 --> 00:11:10,100 and major schools of thought, which will presumably give you a framework of analysis to understand 88 00:11:14,259 --> 00:11:21,259 organization. Above all, the purpose of any subject is at your level of understanding 89 00:11:21,639 --> 00:11:28,639 to get a grasp of what it is about. Therefore, these theories will help you to develop a 90 00:11:31,380 --> 00:11:36,130 framework of analysis of the organization you will deal with, because remember what 91 00:11:36,130 --> 00:11:41,009 I told you in the very first section whether you like it or not, you are dealing with an 92 00:11:41,009 --> 00:11:48,009 organization, whether you like it or not, you exist in an organization and whether you 93 00:11:49,120 --> 00:11:56,120 like it or not, you will need an organization to live as survive, eat and prosper. Even 94 00:11:58,120 --> 00:12:05,120 if you choose not to prosper, you will need an organization just to be, just to exist. 95 00:12:06,339 --> 00:12:13,019 Organization management is one of those inevitable areas which you cannot survive without. The 96 00:12:13,019 --> 00:12:20,019 criticality therefore of understanding organization management is essential. So, whatever we take 97 00:12:23,230 --> 00:12:30,230 up under theory will be looked after as organization theory. This is a full-fledged specialization; 98 00:12:35,449 --> 00:12:40,440 in fact there are full-fledged courses on organizations theory and practice. 99 00:12:40,440 --> 00:12:46,339 The key elements of organization theory are say a definition of organization theory which 100 00:12:46,339 --> 00:12:52,860 is to be rooted. What is a theory? Theory is a plan or scheme existing in the mind only, 101 00:12:52,860 --> 00:12:59,860 but based on principles verifiable by experiment or observation. What is an organization? Organizations 102 00:13:02,170 --> 00:13:08,490 are social entities that are goal-oriented; are designed as deliberately structured and 103 00:13:08,490 --> 00:13:14,019 coordinated activity systems and are linked to the external environment. This is again 104 00:13:14,019 --> 00:13:16,920 another definition of an organization. 105 00:13:16,920 --> 00:13:22,540 What is the definition of an organization theory? I will give you several definitions, 106 00:13:22,540 --> 00:13:29,470 all of them partly correct, none of them captures the full truth, but this is what you call 107 00:13:29,470 --> 00:13:36,029 a literature survey, this is how you will understand the nature of the knowledge which 108 00:13:36,029 --> 00:13:43,029 is available on the subject matter. Organization theory is the set of propositions, 109 00:13:45,490 --> 00:13:52,279 body of knowledge, stemming from a definable field of study which can be termed as organization 110 00:13:52,279 --> 00:13:59,279 science. The study of organization is an applied science because the resulting knowledge is 111 00:14:01,199 --> 00:14:08,199 relevant to the problem solving or decision making in ongoing enterprises or institutions. 112 00:14:11,449 --> 00:14:18,449 How did these organization theories evolved? Early examples of management, captains of 113 00:14:19,579 --> 00:14:25,550 industry, advent of communication channels all these three factors helped these theories 114 00:14:25,550 --> 00:14:32,550 to emerge. In other words, before you are start looking at the theory, you must understand 115 00:14:36,879 --> 00:14:43,879 how theories originate. Theories originate in early experiences which is what is said 116 00:14:44,600 --> 00:14:51,600 here early examples of management. Theories originate because somebody who is in a leadership 117 00:14:52,029 --> 00:14:59,029 position says that it is so. The captains of industry in each region said 118 00:15:00,029 --> 00:15:07,029 well this is how it is. So, the opinion of a leader matters and finally, the advent of 119 00:15:07,060 --> 00:15:14,060 communication channels, you started disseminating what you think to others. You disseminated 120 00:15:14,589 --> 00:15:21,589 through word of mouth, you disseminated through written word and when the electronic medium 121 00:15:24,430 --> 00:15:31,160 came, you disseminated through electronic medium. There are other ways of doing it and 122 00:15:31,160 --> 00:15:35,550 since, this is not a course on communication and you will understand that I expect a certain 123 00:15:35,550 --> 00:15:40,680 background of information with you on what could be termed as advent of communication 124 00:15:40,680 --> 00:15:44,879 channels. 125 00:15:44,879 --> 00:15:51,879 The evolution of management thought is put here schematically from 1890 to roughly today. 126 00:15:56,620 --> 00:16:03,620 They are broadly divided into classical approaches and contemporary approaches. Classical approaches 127 00:16:04,069 --> 00:16:11,069 are approaches with which management theory began and modern approaches are essentially 128 00:16:13,139 --> 00:16:18,250 or the contemporary approaches are essentially the post-world war, two approaches. 129 00:16:18,250 --> 00:16:25,250 In each case, you will find that the dateline has been given. In each case, you find that 130 00:16:27,379 --> 00:16:34,379 there is an arrow which links it up with the theory. Let me walk you through them, 1890 131 00:16:35,089 --> 00:16:42,089 or there about their came the systematic management theory. Around 1905 there came the scientific 132 00:16:43,399 --> 00:16:50,399 management, around 1915 came administrative management and around 1925 came human relations 133 00:16:52,370 --> 00:16:59,370 management, 1930 to 1940 intervening 10 years of the emergence of quantitative management. 134 00:17:00,120 --> 00:17:07,120 1940 people saw the origin of organizational behavior around 1949-1950 systems theory came 135 00:17:08,089 --> 00:17:15,089 into full bloom, around 1950, 1956, 1957, 1958 contingency theory became fashionable 136 00:17:17,199 --> 00:17:22,459 and thereafter, there has been current and future revolutions of organization theory. 137 00:17:22,459 --> 00:17:29,459 Now, this is just as schematic plan to show you which ones came first and which ones came 138 00:17:30,920 --> 00:17:37,920 after. This is not a glassful to swear by you can have other classifications, now that 139 00:17:40,010 --> 00:17:45,040 is something which is very important where you come to the study of management or behavioral 140 00:17:45,040 --> 00:17:50,940 sciences. Very little here is as cut and dried as it 141 00:17:50,940 --> 00:17:57,290 is say, in a lot of engineering disciplines but, what is cut and dried in engineering 142 00:17:57,290 --> 00:18:04,290 disciplines itself is cut and dried only to a certain level, because whatever is cut and 143 00:18:04,750 --> 00:18:11,750 dried also changes. It is not as if once, you propound a theory of thermodynamics the 144 00:18:14,150 --> 00:18:18,750 scientific theory will not change. So that also changes, so you do not have to get very 145 00:18:18,750 --> 00:18:23,860 worried whether everyone accepts this or everyone does not accept it, nothing is accepted by 146 00:18:23,860 --> 00:18:30,430 everyone and even that which is accepted by everyone changes. 147 00:18:30,430 --> 00:18:37,430 As you reach a postgraduate level of educational learning, one of the changes which you have 148 00:18:40,060 --> 00:18:47,060 to internalize in your cognitive system is, whatever you believe can only be a tentative 149 00:18:51,760 --> 00:18:58,760 belief. Whatever you believe is true only so far and no further and most importantly, 150 00:19:01,360 --> 00:19:08,360 what you believe today may not be valid tomorrow. Therefore, where are you left with that then? 151 00:19:14,700 --> 00:19:21,700 All these theories are at best indicators to refine your thinking; all these theories 152 00:19:25,660 --> 00:19:32,660 are essentially a benchmark of the level of knowledge and sophistication which exists. 153 00:19:33,400 --> 00:19:40,400 That you can always argue about it, no systematic theory did not begin in 1890 it began in 1880, 154 00:19:42,120 --> 00:19:49,020 you can keep arguing about it and then you start producing data that actually systems 155 00:19:49,020 --> 00:19:56,020 theory did not begin around 1947-1948 but, it actually began in June 1941, a welcome 156 00:19:59,220 --> 00:20:06,220 to it. This is not like a glassful truth, this is 157 00:20:07,750 --> 00:20:14,750 not like the verdict of the profit, this is not like if you believe it, your soul will 158 00:20:15,680 --> 00:20:22,680 be saved, if you do not believe it, your soul will be dammed these are broad trends. This 159 00:20:26,750 --> 00:20:32,370 is bringing to your level of knowledge and understanding certain patterns which you must 160 00:20:32,370 --> 00:20:38,370 be aware off to take matters forward. Now, we are not going to get into details 161 00:20:38,370 --> 00:20:43,880 of all these theories, it is neither necessary, nor useful but, then it is important for you 162 00:20:43,880 --> 00:20:49,640 to realize that there are different ways of looking at the same proposition, because the 163 00:20:49,640 --> 00:20:56,640 way management was understood in 1890 is not the way management was understood in 1990. 164 00:21:01,300 --> 00:21:07,010 In fact, each generation has to go through the process of understanding, what are the 165 00:21:07,010 --> 00:21:14,010 managerial issues. Pollution was never such an issue on this planet as it is today. Purity 166 00:21:18,800 --> 00:21:25,800 of air, water, soil today is critical to the survival of the human race. When you studied 167 00:21:31,000 --> 00:21:38,000 management in the late 19th century, you could pollute whatever you wanted, however you wanted 168 00:21:41,380 --> 00:21:48,380 and with gay abandon. Indeed, this is how the industrially advanced nation stole a march. 169 00:21:52,730 --> 00:21:59,730 They had all the advantages of waste, the countries which are trying to industrialize 170 00:22:01,400 --> 00:22:07,750 today do not have and this is essentially, what is at the root of all the confabulations 171 00:22:07,750 --> 00:22:11,710 which are taking place on environment laws and why there is no agreement. 172 00:22:11,710 --> 00:22:16,250 You cannot say we had this advantage; we used it to the full advantage, now that we have 173 00:22:16,250 --> 00:22:23,100 done it which is the rules for everyone else, because that is going to end in a situation 174 00:22:23,100 --> 00:22:30,100 of perpetuating inequality. If you have to understand the live issues of management, 175 00:22:31,630 --> 00:22:38,630 you have to apply the principles of life issues to the contemporary situations, which is what 176 00:22:40,680 --> 00:22:47,680 makes management the interesting subject as it is. Each generation defines its own managerial 177 00:22:48,540 --> 00:22:55,540 issues. Each generation has to do decision-making and problem-solving in the context of the 178 00:22:58,670 --> 00:23:05,670 resources which are available. We are living in an era, where the future 179 00:23:08,050 --> 00:23:15,050 growth of the economy will be through natural gas. It is predicted that we are going to 180 00:23:16,970 --> 00:23:23,970 enter an era, which will be determined by the availability of a natural gas. Coal as 181 00:23:26,470 --> 00:23:33,470 a source of energy was developed to appoint and then it plateau out whereas coal is used 182 00:23:35,160 --> 00:23:41,710 still today, it is an energy resource of the past, unless you can have gasification of 183 00:23:41,710 --> 00:23:48,710 coal. Then oil entered the sea and prosperity of 184 00:23:48,920 --> 00:23:54,200 oil determined the political equations and the power equations not only amongst nations 185 00:23:54,200 --> 00:24:01,200 but, also amongst corporate. Till today in technological choice, one of the most important 186 00:24:04,120 --> 00:24:11,120 things is what is the source of energy of this equipment and this machine? You cannot 187 00:24:13,050 --> 00:24:20,050 undertake technological evaluation without a grasp of two critical parameters, which 188 00:24:23,880 --> 00:24:30,880 are common to all equipment today: one is what kind of energy source does it need and 189 00:24:32,520 --> 00:24:38,890 the other is what kind of the nature of material which it has. 190 00:24:38,890 --> 00:24:45,890 You will notice that a lot of management does require you to have a grasp and an appreciation 191 00:24:48,350 --> 00:24:55,350 of cognate areas, which is why I have always felt that management is meant for the best. 192 00:24:57,590 --> 00:25:04,590 No matter, how you fancy yourself, you are quite aware of the kind of level of intelligence 193 00:25:07,900 --> 00:25:12,910 you have, the kind of effort which you put in and the kind of intelligence which you 194 00:25:12,910 --> 00:25:15,340 have. You may say whatever you want in a social 195 00:25:15,340 --> 00:25:22,340 group, but when you doze off in a class and when you are unable to recall, what is being 196 00:25:23,610 --> 00:25:29,020 said and when you do not even understand what the subject is which is being discussed. You 197 00:25:29,020 --> 00:25:36,020 may wake up 10 minutes later and still realize that you have not kept up with what of being 198 00:25:36,410 --> 00:25:40,490 said. Real capability development requires the ability 199 00:25:40,490 --> 00:25:47,490 to assess your own ability and choose something which is suited to you. Since, management 200 00:25:51,450 --> 00:25:58,350 studies are life giving, my advice to people who force themselves into management is quit 201 00:25:58,350 --> 00:26:04,990 while you can, get into something which you can manage otherwise, you will be doing what 202 00:26:04,990 --> 00:26:11,990 happens to you when you bite something which you cannot digest. 203 00:26:12,420 --> 00:26:19,420 Do not lead life trying to keep up with the joneses; I must study management because everyone 204 00:26:20,340 --> 00:26:27,340 else is studying management. You do not have the same height, the same weight as your neighbor. 205 00:26:30,230 --> 00:26:34,770 Except the facts of your life, you are worth something somewhere, discover where you are 206 00:26:34,770 --> 00:26:41,770 worth and discover where you will be successful. If you force yourself into a discipline whatever 207 00:26:43,160 --> 00:26:50,160 else, you may or may not be sure off, I can assure you, you are heading for disaster. 208 00:26:50,290 --> 00:26:57,200 So, while you can drop something which you are not capable off. 209 00:26:57,200 --> 00:27:04,200 The same thing applies to organizations; you cannot run an organization with dated tools 210 00:27:07,500 --> 00:27:14,500 you cannot run an organization with principles, which are dated. Believe in an era, where 211 00:27:15,250 --> 00:27:22,250 the great issue today is management of expectations. A lot of MBA student's even before they are 212 00:27:22,740 --> 00:27:29,740 graduates have career expectations, which are just impossible to live through. 213 00:27:30,690 --> 00:27:36,440 There is no way you will become the managing director of a firm in two and a half years. 214 00:27:36,440 --> 00:27:43,030 With a result that once you graduate, you join an organization and then you go job hopping, 215 00:27:43,030 --> 00:27:49,330 and believe me job hopping does not make all that much of a difference. 216 00:27:49,330 --> 00:27:56,330 You may gain on 1 or 2 items of the salary; you will lose out on 2 or 3 other items. The 217 00:27:57,540 --> 00:28:02,570 summation will be the same; you will be plus or minus 10 percent, plus or minus 20 percent 218 00:28:02,570 --> 00:28:09,190 never more than that. Therefore, please remember, one of the essential 219 00:28:09,190 --> 00:28:16,190 results of all theories of management is to help you to make your own life choices better, 220 00:28:17,520 --> 00:28:21,640 of which the first assumption is and when we again go back to some of the classical 221 00:28:21,640 --> 00:28:28,640 learning [FL]. All learning begins with know yourself [FL] self [FL] no. The way you dress, 222 00:28:43,890 --> 00:28:50,890 what you eat, what language you speak, will be totally irrelevant. Indeed, it will be 223 00:28:56,280 --> 00:29:03,280 very important for you to recognize that all these thoughts and theories of management 224 00:29:07,140 --> 00:29:14,140 have consistently over the years, missed out on the most important principle of management 225 00:29:14,880 --> 00:29:21,880 theory - management of self. Therefore, whatever theory you learned here 226 00:29:25,910 --> 00:29:32,910 and whatever theory you will pick here, please realize you are supposed to reflect on them 227 00:29:32,920 --> 00:29:39,920 intelligently. You are supposed to understand it, so that you can practice it. If you can 228 00:29:43,730 --> 00:29:48,890 neither understand it, nor practice it, you should be asking, whether you are a fit subject 229 00:29:48,890 --> 00:29:55,890 for these sessions or not. 230 00:29:56,500 --> 00:30:00,560 The first theory which I am going to talk to you is called the classical theory of organization 231 00:30:00,560 --> 00:30:07,560 management. Not that there want what other theories but, this is usually considered the 232 00:30:08,540 --> 00:30:15,540 beginning of organized theory formation in organizations. 233 00:30:16,280 --> 00:30:23,280 Classical organization theory is rooted in the work of Frederick Taylor, not that I believe 234 00:30:25,890 --> 00:30:31,350 that management begins with Frederick Taylor but, at your level of learning it is best 235 00:30:31,350 --> 00:30:37,710 to keep pace with what is a general belief. If you have other beliefs, there will be other 236 00:30:37,710 --> 00:30:43,540 occasions to learn of it and this is not the time to generate a debate. 237 00:30:43,540 --> 00:30:50,540 Frederick Taylor thought industrial engineering at Steven's institute of technology in New 238 00:30:52,130 --> 00:30:59,130 Jersey. If you visit there, you will find that in view of his standing in the field 239 00:30:59,620 --> 00:31:06,620 of management, they have got a bust of Frederick Taylor in one of the most prominent public 240 00:31:07,880 --> 00:31:14,880 spaces of the institute. So that all who are of that institute derive pride of the kind 241 00:31:19,450 --> 00:31:26,290 of intellectual giant which worked there and all who come to the institute know, the great 242 00:31:26,290 --> 00:31:29,760 learning traditions which were propounded in that institute. 243 00:31:29,760 --> 00:31:36,760 Go back to legacy factor or longitudinal thinking. Scientific management had some takers; there 244 00:31:40,670 --> 00:31:46,110 were three major theories beside scientific management: one was the bureaucratic theory 245 00:31:46,110 --> 00:31:52,670 which established by Max Weber, the third was principles of general and administrative 246 00:31:52,670 --> 00:31:58,780 management which Henry Fayol talked about. 247 00:31:58,780 --> 00:32:05,780 The scientific theory of Frederick Taylor was propounded by him around 1900. It advocated 248 00:32:09,210 --> 00:32:16,210 application of the scientific methods to improve productivity. The classical theory was conspicuous 249 00:32:18,360 --> 00:32:25,080 by its lack of understanding of anything which had to do with human beings. 250 00:32:25,080 --> 00:32:31,530 It was a simple time and motion study in fact, so far as I am concerned there was no management 251 00:32:31,530 --> 00:32:38,530 in it at all. If it was a simple time and motion study then, you should be studying 252 00:32:39,480 --> 00:32:46,480 the principle of a pulley and designing a pulley is not management important as it is, 253 00:32:49,210 --> 00:32:56,210 but then again, you cannot swim against a trend, if everyone says that the scientific 254 00:32:57,880 --> 00:33:03,030 methods of improving productivity are the forerunners well, then you need to be told 255 00:33:03,030 --> 00:33:09,630 that also. That was the course specialization of Frederick 256 00:33:09,630 --> 00:33:16,370 Taylor. If he was to be alive a 100 years later and perhaps be present in this class, 257 00:33:16,370 --> 00:33:22,820 he would be surprised that he is supposed to have fathered organization theory, but 258 00:33:22,820 --> 00:33:29,510 then what do you do when you do not know your father, you create one. It is important to 259 00:33:29,510 --> 00:33:36,510 have a father at least filling out application forms makes it mandatory to create a father, 260 00:33:39,140 --> 00:33:46,110 orphans have no place in this world, I am not saying it, that is what the practice is. 261 00:33:46,110 --> 00:33:52,530 You know, when it is becoming so fashionable to talk of caste, census analysis and I did 262 00:33:52,530 --> 00:33:58,890 tell you that management are applied to the current issues, I did not talk of environment 263 00:33:58,890 --> 00:34:03,470 and I did not talk of sources of energy. There is no reason why we should find any subject 264 00:34:03,470 --> 00:34:08,760 it above. I am always wondered when the caste census is conducted, which I think is a very 265 00:34:08,760 --> 00:34:11,990 fashionable thought with certain segments of the people, how will that the orphan define 266 00:34:11,990 --> 00:34:18,990 its cast or will they have a caste of orphans? What will they do with the destitute or will 267 00:34:20,389 --> 00:34:24,690 have a caste of the destitute? But, you are not interested in this, if you are interested 268 00:34:24,690 --> 00:34:30,339 in politics, because your purpose is not social engineering; your purpose is to make sure 269 00:34:30,339 --> 00:34:37,339 you are in the right side of operating power. One of the outcomes of studying management 270 00:34:38,339 --> 00:34:45,339 is to get your lenses cleaned on decision-making and problem-solving and understand how decision-making 271 00:34:45,669 --> 00:34:52,669 is done and decision-making is a political process which is why alas. For good or for 272 00:34:55,240 --> 00:35:02,240 evil, with joy or sadness whatever be it, these topics cannot be circuited, if you want 273 00:35:03,789 --> 00:35:10,789 to study management the way it is. Remember, politics is the struggle for the control of 274 00:35:11,359 --> 00:35:18,359 the decision-making process. In fact, one of the topics which we will not be taking 275 00:35:18,619 --> 00:35:25,619 up in the sessions is the impact of different disciplines on management. 276 00:35:29,970 --> 00:35:34,809 In other words, how far does management borrow from psychology, how far does management barrow 277 00:35:34,809 --> 00:35:40,069 from industrial engineering, how far does management borrow from anthropology, how far 278 00:35:40,069 --> 00:35:47,059 it borrows from history, how far it borrows from systems analysis. There are other disciplines 279 00:35:47,059 --> 00:35:51,299 you cannot study political science without looking at the interface of political science 280 00:35:51,299 --> 00:35:58,250 with other areas. We were discussing this in a small group and somebody said one of 281 00:35:58,250 --> 00:36:02,900 the most important disciplines which make an impact on management is the study of political 282 00:36:02,900 --> 00:36:09,900 science. You cannot understand management without understanding 283 00:36:11,359 --> 00:36:16,380 political science, no there are not many takers of that but, remember management is still 284 00:36:16,380 --> 00:36:23,380 a discipline, which has to acquire that maturity which comes out of centuries of analysis. 285 00:36:25,950 --> 00:36:30,140 Modern management not conventional management, which I have discussed in the first session 286 00:36:30,140 --> 00:36:34,680 itself, modern management is not even a 150 years old, compare it to the tradition of 287 00:36:34,680 --> 00:36:41,680 civil engineering, compare it to the tradition of history. History has been taught, studied, 288 00:36:43,569 --> 00:36:50,569 researched for over 3000 years as a discipline. Civil engineering has existed as a modern 289 00:36:52,279 --> 00:36:59,279 discipline for several centuries. When you look at a discipline which is hardly 100 years 290 00:36:59,839 --> 00:37:06,839 old, what is the antiquity of that discipline? Obviously, everyone believes that management 291 00:37:07,500 --> 00:37:13,009 originated in his discipline. You talk to an industrial engineer; he believes management 292 00:37:13,009 --> 00:37:20,009 began in industrial engineering. You talk to a psychologist; he believes management 293 00:37:20,049 --> 00:37:27,049 began from psychology. You talk to a person from systems analysis; 294 00:37:32,250 --> 00:37:38,089 he will tell you all management in systems analysis. The other day I was with a group 295 00:37:38,089 --> 00:37:41,869 of economists, there were quite determined that all management began in economics, I 296 00:37:41,869 --> 00:37:48,869 was reminded of that telling analogy of 6 blind men and the elephant. Each one quite 297 00:37:51,599 --> 00:37:57,720 convinced he has got the truth. Unless, you understand the nature of management, 298 00:37:57,720 --> 00:38:02,960 you will also start believing that management originated from the discipline from which 299 00:38:02,960 --> 00:38:09,960 you came. What is the trouble with this approach? If you occupy a key position in an organization, 300 00:38:12,220 --> 00:38:16,109 then you start selling that approach to everyone. 301 00:38:16,109 --> 00:38:23,109 Remember, what I said earlier on, going back to the origins of theory, were I told you, 302 00:38:28,299 --> 00:38:35,299 earlier examples of management captains of industry. See, if you are in industrial engineer, 303 00:38:37,599 --> 00:38:43,740 you start telling people everywhere management is under industrial engineering, now that 304 00:38:43,740 --> 00:38:50,740 is terrible English; it is worse management. I have known a person who made his career 305 00:38:52,240 --> 00:38:59,240 teaching management, propound publicly everywhere management is under industrial engineering. 306 00:39:00,200 --> 00:39:05,329 Lot of people would believe him, because he has held key positions. 307 00:39:05,329 --> 00:39:12,329 I hope the new generation of management students and I hope the new generation of practitioners 308 00:39:13,089 --> 00:39:20,089 of management will realize that whether management is an old discipline or a new discipline, 309 00:39:21,269 --> 00:39:28,269 management is now establish enough to do have its own character, to have its own nature. 310 00:39:28,940 --> 00:39:35,940 Management has never been under any discipline and you did hear me say, it is bad English 311 00:39:37,289 --> 00:39:42,759 and worse management. Therefore, to understand the theories of organization 312 00:39:42,759 --> 00:39:49,230 management, you must understand where the propounders came from and this is undertaking 313 00:39:49,230 --> 00:39:56,230 a critique of that theory. One of the easiest exercises to undertake is to rationalize your 314 00:40:00,200 --> 00:40:07,200 own primacy. So, I forgive Frederick Taylor for his time and motion study. At least he 315 00:40:11,099 --> 00:40:16,200 marked a research beginning, so credit must be given to him but, then the world has moved 316 00:40:16,200 --> 00:40:23,200 much beyond that. What I am trying to tell you is that Frederick Taylor did make a contribution 317 00:40:28,309 --> 00:40:33,730 to management by optimization of performance of work to achieve one best method. 318 00:40:33,730 --> 00:40:40,730 With all its limitations Frederick Taylor's contribution to management theories is emphasis 319 00:40:42,799 --> 00:40:49,799 at measurement. Alas Frederick Taylor did not live long enough to live in the human 320 00:40:52,240 --> 00:40:59,240 resources theory era, which hit the other side of the pendulum and people started saying, 321 00:40:59,359 --> 00:41:03,999 you cannot measure. Remember, if you make a statement which is 322 00:41:03,999 --> 00:41:10,999 too bigoted, you will generate its own antithesis. Somebody will get up and say exactly 180 degrees 323 00:41:14,380 --> 00:41:21,380 opposite of the same thing. So, it is best to propound all theories with a touch of tentativeness, 324 00:41:24,749 --> 00:41:31,749 with a touch of humility and with a genuine attempt to receive feedback. Recognition that 325 00:41:35,160 --> 00:41:42,160 after all you could need an improvement on what you are saying that is the hallmark of 326 00:41:43,220 --> 00:41:50,220 a scholar; he does not make statements directed towards establishing the primacy of his own 327 00:41:53,430 --> 00:41:56,470 discipline. 328 00:41:56,470 --> 00:42:03,470 The scientific theory of Frederick Taylor as I said, simplified skilled jobs to unskilled 329 00:42:05,950 --> 00:42:12,950 ones and they said you do this for the best result, you will do as directed. Now, if you 330 00:42:14,609 --> 00:42:20,059 come to soldiering, he identified three main reasons for soldiering increase in productivity 331 00:42:20,059 --> 00:42:25,619 will require fewer workers, employee would receive same pay for higher productivity, 332 00:42:25,619 --> 00:42:31,999 faster pace would be set as standard and used rule of thumb and wasted time. 333 00:42:31,999 --> 00:42:38,999 Used rule of thumb and wasted time was not desirable. In other words, the entire focus 334 00:42:40,190 --> 00:42:47,190 of classical theory was on productivity. Not national rural employment generation scheme 335 00:42:51,589 --> 00:42:58,589 for heaven's sake, Frederick Taylor would have committed suicide. He believed in no 336 00:42:58,670 --> 00:43:05,410 such thing, he could get up and say give me the result. You know, what you are supposed 337 00:43:05,410 --> 00:43:09,970 to do when you get a sufficiently high rank in the organization. You are supposed to turn 338 00:43:09,970 --> 00:43:15,460 around your subordinates and say, give me results. You know, one of those ugly statements 339 00:43:15,460 --> 00:43:19,880 like, management is getting others to do your work. 340 00:43:19,880 --> 00:43:24,710 Whether you get anything out of the sessions or not, at least I hope when you do get somewhere 341 00:43:24,710 --> 00:43:29,660 in your life, you will not be the sort of person using this ugly statements, I believe 342 00:43:29,660 --> 00:43:34,640 in results. What are you some sort of god almighty, I believe in results, I thought 343 00:43:34,640 --> 00:43:41,640 you believed in god himself. Sir, what should I do to do results? That is your problem. 344 00:43:42,920 --> 00:43:47,569 It is a shear pathetic character of people in leadership positions who do not know the 345 00:43:47,569 --> 00:43:54,039 theory and practice of management and yet who pretend to build taller than titans. 346 00:43:54,039 --> 00:44:00,029 The world is full of them but that is another story, what I want you to understand is time 347 00:44:00,029 --> 00:44:07,029 studies required, studying of time workers and to determine the best way, most mindless 348 00:44:07,339 --> 00:44:13,549 jobs could be scientifically done to increase productivity, better than initiative and incentive 349 00:44:13,549 --> 00:44:18,400 method. 350 00:44:18,400 --> 00:44:23,259 Time studies lead to the four principles of scientific management: replace the rule of 351 00:44:23,259 --> 00:44:27,690 thumb work method with methods based on scientific study of the task, now you cannot argue with 352 00:44:27,690 --> 00:44:34,690 this. Therefore, it is not as if classical theory does not make a contribution to management. 353 00:44:35,099 --> 00:44:42,099 The question is to understand how far it goes and with what? Scientifically select, train 354 00:44:43,380 --> 00:44:49,849 and develop each worker rather than passively leaving him to train themselves. In other 355 00:44:49,849 --> 00:44:56,849 words, there is a conscious intervention. The remaining two principles are, cooperate 356 00:44:59,980 --> 00:45:05,829 with the workers to ensure that the scientifically developed methods are being followed. 357 00:45:05,829 --> 00:45:12,829 In this kind of thought that standard operating procedure as a phrase is embedded that is 358 00:45:13,970 --> 00:45:19,499 the best way of doing things. If you want to survive with the organization, you are 359 00:45:19,499 --> 00:45:24,440 supposed to follow that best way and not argue with it, at least according to the scientific 360 00:45:24,440 --> 00:45:31,059 theory. Divide work nearly equally between managers 361 00:45:31,059 --> 00:45:36,609 and workers, so that the managers apply scientific management principles to planning of the work 362 00:45:36,609 --> 00:45:43,609 and the workers actually perform the tasks. What you have got from me is the essentials 363 00:45:44,950 --> 00:45:51,950 of scientific theory of management, the classical theory of management, how is it operated? 364 00:45:55,529 --> 00:46:01,130 How did it originate? How is it practiced? Also, we have tried to look at its limitations 365 00:46:01,130 --> 00:46:02,400 and look at its strengths. 366 00:46:02,400 --> 00:46:07,759 We therefore, now go on to taking a quick look at its drawbacks which is increase the 367 00:46:07,759 --> 00:46:14,759 monotony of work, dehumanized work. We move on then to bureaucracy theory which is by 368 00:46:17,089 --> 00:46:18,220 Max Weber. 369 00:46:18,220 --> 00:46:25,220 Again, like the scientific theory the bureaucracy theory works both ways. It has strength, it 370 00:46:28,019 --> 00:46:34,380 served the purpose and it has its problems. Your first attempt will be to understand, 371 00:46:34,380 --> 00:46:41,380 what something is before you can undertake a critique on it. It was proposed by Max Weber 372 00:46:41,650 --> 00:46:48,650 in 1909 recognized by bureaucracy as a logical structure for large organizations. Now, the 373 00:46:52,029 --> 00:46:59,029 truth is the era in which we live bureaucracy has become an ugly world. 374 00:46:59,480 --> 00:47:06,130 In fact, a very common statement would be, do not be bureaucratic, but the truth is if 375 00:47:06,130 --> 00:47:11,259 you have a group of people working together for an achievement of an objective, there 376 00:47:11,259 --> 00:47:18,259 will be some kind of bureaucracy. It is inherent, what is the bureaucracy therefore? Bureaucracy 377 00:47:23,660 --> 00:47:30,660 is a scalar principle, different levels of work. There is a clear difference between 378 00:47:31,670 --> 00:47:38,670 the quality of skill required in placing a chair and in delivering a lecture. Both the 379 00:47:39,710 --> 00:47:45,349 qualities are not the same, so there is a hierarchy of work. 380 00:47:45,349 --> 00:47:52,349 If there is a hierarchy of work, there will be a hierarchy of command. If there is a hierarchy 381 00:47:52,599 --> 00:47:59,599 of command there will be information flow. If there is information flow then there has 382 00:48:00,519 --> 00:48:07,519 to be information collection and information distribution. There has to be supervision, 383 00:48:13,799 --> 00:48:20,799 you cannot get away from it. Therefore, the truth is whether you like it 384 00:48:23,569 --> 00:48:30,569 or not, bureaucracy is inherent in any group activity. You have to recognize that bureaucracy 385 00:48:37,289 --> 00:48:44,289 is a logical structure for large organizations, operations characterized by impersonal rules. 386 00:48:52,239 --> 00:48:59,239 Bureaucracy also does not recognize exceptions. Bureaucracy survives on the grand principle, 387 00:49:00,279 --> 00:49:07,210 if I do it for you I will have to do it for everyone. A palpably erroneous assumption 388 00:49:07,210 --> 00:49:14,210 but, then there is merit in taking that argument, because bureaucracy believes in creating an 389 00:49:16,670 --> 00:49:23,670 impersonal environment; impersonalisation and focus on the system. You will hear a lot 390 00:49:27,869 --> 00:49:34,869 of managers claiming there on a systems driven organization. It is a good idea, but is there 391 00:49:35,210 --> 00:49:40,390 any limit to the systems driven organization? That is the question. 392 00:49:40,390 --> 00:49:47,390 What are the key principles of bureaucracy? Insistence on following standard rules, there 393 00:49:47,680 --> 00:49:54,680 at least there are no heart birds, systematic division of work, there is a principle of 394 00:49:59,319 --> 00:50:06,319 hierarchy, knowledge of and training in application of rules. 395 00:50:07,970 --> 00:50:14,970 Recording in writing of administrative acts, decision and rules; it will not be a subject 396 00:50:15,180 --> 00:50:22,180 of personal memory, it will not be a factor of interpretation. If you implement something 397 00:50:28,369 --> 00:50:35,369 there must be the sanction of the competent authority. Above all, there must be a rational, 398 00:50:38,450 --> 00:50:42,799 personal administration it cannot be whimsical. 399 00:50:42,799 --> 00:50:49,559 There are merits to this system; the merit is it is a pragmatic approach. The focus is 400 00:50:49,559 --> 00:50:53,739 on the system rather than the individual. So, there is very little scope for playing 401 00:50:53,739 --> 00:51:00,739 favorites. There is a sense of equity and fair play, whatever applies to me applies 402 00:51:00,749 --> 00:51:02,160 to everyone. 403 00:51:02,160 --> 00:51:09,160 There are demerits too; demerits are organization tend to become too procedure oriented. Therefore, 404 00:51:10,839 --> 00:51:17,839 the genuine cases of exception go by the side line. It may lead to inefficiency, because 405 00:51:21,410 --> 00:51:28,410 so long, as you observe the rules you are safe, which is why unusual as it may sound 406 00:51:29,230 --> 00:51:36,230 in a lot of labour unrest situations, the labour resorts to work by rule. Something 407 00:51:39,989 --> 00:51:46,989 which builds me, how can productivity decrease if you work to by rule but, it just shows 408 00:51:47,029 --> 00:51:52,430 that rules are meant for the average and therefore, if I work by rule I impede the system it is 409 00:51:52,430 --> 00:51:59,069 an agitation technique, we will now reserve to work by rule. That is a classic example 410 00:51:59,069 --> 00:52:04,269 of the demerits of the bureaucratic system. 411 00:52:04,269 --> 00:52:09,109 The principles of general management then follow but then, so far we have looked at 412 00:52:09,109 --> 00:52:14,309 two theories: the classical theory which was propounded by Frederick Taylor, the bureaucratic 413 00:52:14,309 --> 00:52:21,309 theory which was propounded by Max Weber. Both have their merits and demerits and both 414 00:52:22,359 --> 00:52:29,359 of them exist today. It is just that neither of them can run whole 415 00:52:31,109 --> 00:52:38,109 organizations. It is great to follow the classical theory up to a point on a shop floor level. 416 00:52:40,329 --> 00:52:47,329 At least the standards of performance are measured. It is great to follow some bureaucratic 417 00:52:49,880 --> 00:52:56,880 principles at a larger level of the organization, because it helps to view together large numbers 418 00:52:59,670 --> 00:53:06,670 together in any area. You will realize that there are merits and 419 00:53:06,869 --> 00:53:12,920 demerits; above all it is the application of these principles, which brings about the 420 00:53:12,920 --> 00:53:19,900 operational advantage or disadvantage of the theory. We have looked at theories, we will 421 00:53:19,900 --> 00:53:23,710 stop there for this session and we shall pick it up with principles of general management 422 00:53:23,710 --> 00:53:30,710 hereafter.