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FOREIGN TRADE UNIVERSITY FACULTY OF INTERNATIONAL EDUCATION SCIENTIFIC MANAGEMENT AND HUMAN RELATIONS APPROACHES IN 21st CENTURY ESSAY NAME: NGUY? N TH? PHUONG LINH CLASS: FB3-A1 MENTOR: Dr. NGUY? N THU TH? Y Mr. HOANG ANH DUY (MBA) DATE: 2012 INTRODUCTION Organization is a group of at least two people intentionally organized to accomplish specific goals. Therefore, this leads to the appearance of management and organizational behavior theory with a view to developing an organization.

In which, management is the process of working with people and a variety of resources such as human, information, facilities, etc in order to achieve organizational goals while organizational behavior as J. & Davis, K. (1993) showed that is “the study and application of knowledge about how people, individuals and groups act in organizations”. These methods had further been developed which resulted in Scientific Management as well as Human Relations approaches which exist in a large number of organizations and play an important role in making organizations successful.

Notwithstanding, there are significant modifications in the way modern organizations work placed alongside traditional organizations. Hence, this raises a question of whether Scientific Management and Human Relations approaches are still applicable in 21st –century organizations. This essay provides detailed information about these theories as well as the analysis of their advantages and disadvantages. Thereby, their application will be indicated and evaluated so as to find out whether they are appropriate to modern organization or not.

CONTENT A. Scientific Management: 1. Overview: a, Definition: Scientific management (also called Taylorism) was developed by Frederick. W. Taylor (who was considered as the father of scientific management) in 1980s and 1990s within the manufacturing industries and was first published in his first monographs, namely A Piece Rate System (1985), Shop Management (1903) and The Principles of Scientific Management (1911). b, Principle of Scientific Management: Scientific management was a theory of management analyzing and synthesizing workflows.

According to Fredrick Winslow Taylor: “Scientific management means knowing exactly what you want men to do and seeing that they do it in the best and the cheapest way. ” To be specific, there are four principles of scientific management. The first is the development of science for each person’ work with a view to replacing the old rule-of-thumb methods. The second are scientific selection, training and the development of workers with the aim of assisting employees in training themselves as best they can. The third is the co-operation between workers and management so that work is ensured to be implemented based on devised procedures.

The ultimate is the division of work and responsibility between management and workers, in which all the organizational members are offered equal shares and responsibilities. Additionally, there is encouraging and motivating workers by incentive bonuses or payments. All of these principles focus on the main objective that is increasing productivity as well as the efficiency of working methods. c, Advantages and disadvantages: Every story has two sides and scientific management makes no exception. It also has pros and cons. First and foremost is about is advantages.

Through scientific management, the work is simplified and standardized as it is broken down into component parts. This leads to increasing productivity and increased turnover accordingly that attracts investor with foreseeable profits. In addition, it provides incentive system of wages which helps enhance the standard of production. Furthermore, scientific management applies systematic working methods associated with pre-determined plans resulting in reducing wastage of time and ensuring the quality of work. Likewise, the production postponement lessens on account of pre-establishing the product operations.

Nonetheless, there are also a number of drawbacks when it comes to scientific management. This theory is not useful to deal with teamwork or group work. It also ignores individual preferences and initiatives. Workers are treating as machines while soft factors are paid no attention as it mainly emphasizes measuring. 2. The application of Scientific Management in 21st-century organization: a, Example: Scientific management is still applied by many types of today organizations. There are a considerable number of well-known companies that still apply scientific management to their business operation.

The fist typical example is Mc Donald (MCD)- the world’s largest chain of hamburger fast food restaurant which serving around 68 million customers daily in 119 countries. The principles of scientific management have been applied by MCD in its business operation for 3 functions: the development of the workman and the scientific education, the method of performing every job and the system of rewarding in order to achieve goals as shown on Mc Donald’s corporate website, 2008. Specifically, MCD provides an incentive system of wages, in which offers bonuses for workers base on the amount of work that they produce.

Long term incentives are offered to the deserving employees to retain and reward them who show the sustainable performances and have the long term creation for the company that facilitate increasing the efficient and effective performance of the company. Moreover, the company sets up scientific training program. There are continual trainings for everyone in their business whether they are part time, full time or hourly paid staff because high demands involve providing high quality for the food. There is fifteen minutes training for new employees for attaining the maximum efficiency for the job.

MCD uses machines that control the amount of materials and the cook time given in the numerical value with a view to developing the approach of the large volume, high speed, the low-price in the procedure of assembly-line for the serving and the cooking of the food. In MCD, managers take the major decision centrally and are responsible for the main role on monitoring and are charged with the performance of the staffs, products, procedures. Scientific management plays an important role in the development and improvement of MCD’s organizational management approaches which help its products become more plentiful. Another example re Ford- a multinational company and top five car manufacturer in the world whose roots are based on the scientific management model. This theory refers to the application of Henry Ford’s faith in mass production according to Marcouse (1996). To be specific, jobs are automatized or broken down into unskilled or semi-skilled tasks. Autocratic management ensures a high division of labor in order to effectively run mass production. Equally, Ford company provides the piece rate payment system. Workers are pushed by financial motivation and stimulated by incentive wages whereas employers take control over the labor force.

Panasonic corporation- a Japanese multinational consumer electronics corporation headquatered in Kadoma, Japan is also a company that applies scientific management successfully. In which, all employees have strong sense of responsibility and management and workers are co-operated. b, Evaluation for applicability of Scientific Management: Through the application of these companies, as far as I am concerned, scientific management is still appropriate for managing modern organizations. Firstly, management is getting more scientific compared to the past. Improving production’s efficiency is the primary focus of scientific management.

It aims to find out and nurture workers’ ability and assists them providing best performance in their work in order to acquire the maximum of efficiency. Secondly, the above companies concentrate on the co-operation between the management and workers in which they have identical targets that help them achieve the highest amount of profit. Equally importance, scientific management makes a significant contribution towards achieving the economies of scale. The division of labor and specialization within employees allow each worker to be highly effective at performing their limited tasks.

As a result, firms will have efficient production methods and techniques. Also, the organizational managers are capable of taking full control over their subordinate accordance with the piece rate payment system playing a role in ensuring that employees produce the devised amount of work. 3. Comparison between traditional and modern organization: Much as scientific management places a crucial position in the 21st-century organization, this method still contains weaknesses leading to restriction on nowadays working environments.

There are significant changes in modern organizations compared with traditional ones which are shown in the table below: Changing organization Traditional organization| Modern organization| Stable| Dynamic| Inflexible| Flexible| Job-focused| Skills-focused| Individual-oriented| Work is defined in terms of task to be done| Permanent jobs| Temporary jobs| Command-oriented| Team-orientedInvolvement-oriented| Managers always make decisions| Employees participate in decision making| Rule-oriented| Customer-oriented| Relatively homogeneous workforce| Diverse workforce|

Workdays defined as 9 to 5| Workdays have no time boundaries| Hierarchical relationships| Lateral and networked relationships| Work at organization facility during specific hours| Work anywhere, anytime| Source: Stephen Robbins et al. , 2003. Adapted from Management As we can seen from the table, traditional organizations treated employees as machines, in which they had to work in a long period of time and implemented repeated processes. This inevitably resulted in making them suffer a great deal of pressure and the efficiency of work was declined accordingly.

In modern form, conversely, workers are considered as competitive assets as well as long-term perspective and a resource of the company. Workers are no longer satisfied by not only financial rewards but their social needs as well. Thus, there are a considerable number of disadvantages of scientific management. This method asked worker to work harder and concentrate for long period which is the main motives in causing dissatisfaction, anti-motivation and even strikes and the productivity and work efficiency will be adversely affected.

Likewise, the piece rate payment system may encourage staffs to concentrate on quantity without paying attention to quality. This method also ignores individual differences since this way of working may be appropriate for one person but may be inefficient for others. Another drawback of scientific management is that employees are highly specialized so that their adaptability to continuously changing environment will be limited. All of these weaknesses of scientific management had led to the appearance of Human Relations approaches. B. Human Relations Approaches: 1. Overview:

The term “human relations” in organizational context means the relationship between workers and managers. To put it another way, it is a study of human problems arising from organizational and interpersonal relations industry. It is meant to help better interpersonal and intergroup adjustments. The human relations approaches appeared in 1930s as “a reaction against the mechanistic view of organizations and the pessimistic view of human nature suggested by the classical approach” according to Cary L. Cooper, Chris Argyris, William Starbuck. eds. (2004). This was developed by Elton Mayo.

In 1927, Mayo and a group of Harvard University researchers conducted a research at Western Electric Company’s Hawthorn in America, known as the Hawthorne studies. This aimed to examine the impact of working conditions on employees’ productivity. The experiments revealed that in the past, workers were treated as machines but now they were considered as individuals. This had brought new insights into individual and group behavior as well as the behavior of people at work. It found out that when worked in group, staffs affected each other and due to being observed by managers, they asked each other to remain productivity levels.

This means that group pressures could significantly impact individuals’ productivity. The studies indicated that monetary rewards and economic benefits are not only sources of employees’ motivation and satisfaction. This research was the beginning of the human relations movement. Based on the above information, it is apparent that human relations focus on social factors at work placed alongside the past the main concentration is on muscle. Besides, another focus is the behavior of employees within organization. 2. Neo-human relations: , Hierarchy of Needs: The Hawthorne studies resulted in the appearance of generation of new ideas which pay attention to such matters as organization structuring, importance of group work, leadership styles, communication and participation, out put restrictions, motivation and job satisfaction. This is called Neo-human relations as “the new ideas on management theory arose and a major focus of concern was the personal adjustment of the individual within the work organization and the effects of group relationships and leadership styles” [University of Bedfordshire (2010)].

These approaches focus on the convergence of individuals and organizational needs. The first approach worth mentioning is the “Hierarchy of Needs” developed by Abraham Maslow: Hierarchy of Needs Source: Maslow, A. H. , 1943. A Theory of Human Motivation In this approach, self-actualization is the top of people’s needs. This is the needs for personal fulfillment, for recognizing one’s own potential, talents and capability. In order to satisfy employees’ self-actualization needs, organization offer challenging and creative work tasks as well as great opportunities for advancement according to individual value.

Maslow indicated that a satisfied need is no longer a motivator. Once the physiological needs have been met, the person becomes concerned with higher order of needs. Business organizations satisfy the physiological and safety needs of employees. Nonetheless, the Hawthorne studies pointed out that people are not like machines and that they are more interested in obtaining social spoils of working life rather than monetary factor, especially their urge to upgrade. , Theory X & Y : The second approach is Theory X & Y of Douglas McGregor. It assumes that X-people are employees who are lazy, dislike work and want to be out of work. On the other hand, Y-people are employees who are talent, creative and able to control themselves and seek responsibilities under the proper conditions with a view to getting hold of social as well as personal fulfillment such as esteem, self-actualization needs, etc. Thereby, McGregor used the “Rod and Carrot” principle.

To be specific, in order to deal with X-people, managers need to use “Rod”, this means this type of workers have to be controlled and supervised tightly or even threatened with strict punishment so as to force them to put all their effort towards the achievement of organizational objectives. On the contrary, managers will present “Carrot” to Y-people. That is to say, since this kind of employees emphasizes self-control and self-direction, they do not need to be strictly control and monitored. Conversely, they should be offered bonuses, awarded and motivated.

This approach requires an implementation of new managerial strategy. c, Theory of Needs: Thirdly, it is about David McCelland’s Theory of Needs (three needs theory) which refers to individual’s specific needs obtained over long term and are shaped during one’s whole life experience. This approach mentions three types of need and therefore requires different ways of motivating people who pursue each type of needs. There are needs for achievement, which means people who look for success and try to avoid low-risk and high-risk situations as much as possible.

Therefore, they should be delegated challenging tasks accordance with reachable objectives. The other one is needs for affiliation, in which people tend to establish harmonious relationships with others inasmuch as they want to be accepted by other people. Consequently, they will perform effectively in a cooperative environment. The final is needs for power including personal (who wants to direct and control others) and institutional (who wants to direct the effort of others to stimulate organizational goals).

This type of people should be offer the opportunity for managing other people. d, Two-factors theory: Finally, an important approach is the two factors theory of Frederick Herzbeg, which is also known as Herzberg’s Motivation-Hygiene Theory. This comprises motivation factors that give positive satisfaction, arising from intrinsic conditions of the job itself, such as recognition, achievement, responsibility or personal growth (advancement) based on the argument of Hackman J. R. & Oldham, G. R. 1976) and hygiene factors that do not give positive satisfaction, though dissatisfaction stems from their absence such as working conditions, supervision, interpersonal relationships, security, company policy and administration, salary. These are external factors that affect the work itself, and include aspects such as company policies, supervised practices, or wage system according to Herzbeg, F. (1986). The first type of factors motivates workers to get hold of higher performance while the remaining ensures to retain the employees in organizations. . The application of Human Relations Approaches in 21st-century organization: Human relations approaches exist in all sorts of organization nowadays. The first example is about the application of hierarchy of needs theory in some today organizations (as shown in appendix), in which they satisfy the basic needs and desires of their employees by a variety of policies that offer workers bonuses and rewards. GLENFED, Inc. , a financial and real estate services corporation.

They motivate employees by satisfying by offering incentive programs reward performance and each month, GLENFED honors more than 240 employees with awards for excellence and internal recognition at sales rallies and other events. In New York Life Insurance Company, meanwhile, employees are given responsibility by taking part in setting goals and decision making. They are rewarded based on their performance. In Tektronix, Inc. they increase productivity by offering job enrichment along with manufacturing electronic measurement, design, display, and control systems and especially employees are cross-trained on all jobs.

In Stone Container Corporation, all staffs attend regular scheduled employee involvement meetings. They discuss what could be done to enhance the quality of products, make them easier for customers to use or more cost-effective. They also discuss ways of giving better service to customers and creating innovative methods to improve that service and improvements for internal operations. The meetings are part of a company-wide process called IQS— Innovation, Quality, and Service—which has assisted increasing sales from $427 million to $3. billion during the last five years. General Electric, Unilever, and many big consulting companies are implementing efficient teamwork method which leads to the close and solid relationship among employees deriving from the positive atmosphere in organizations, indicated by Pyoria (2005). This can improve the performance of organizational members. 4. Evaluation of the applicability of Human relations approaches: Similar to scientific management, human relations approaches also have pros and cons.

human relations theory pros and cons

Firstly, it is still relevant to today organizations because it consolidates the basic operation of scientific management’s principles and assists to fulfill employees’ social and emotional needs simultaneously. This ensures that organizational goals are achieved while employees are still able to obtain their needs from the basic level to the further one. Notwithstanding, it also brings some disadvantages such as highly emphasizing the human aspect in the organization.

To survive in the rigorously competitive environment nowadays, they have to care about many other factors besides the human factor. This also may result in personal conflict in terms of satisfying a variety of interests and needs as well as different behaviors or attitudes. CONCLUSION As far as I am concerned, scientific management and human relations approaches are still applicable in the 21st-century organization. Scientific management makes substantial contributions towards enhancing efficiency and effectiveness of a variety of industries.

It performs a crucial role in developing and improving the ways that many organizational management approaches operate today. Human relations approaches, meanwhile, give new insight into human aspect at workplace and thus, help retain best employees as well as motivate them to dedicate all their effort to acquire the organizational goals. Much as these two approaches have open the door for a huge number of upgrade and modified business today, both of them have advantages and disadvantages which still need to be improved, adjusted as well as consolidated.

Therefore, in my opinion, today organizations should combine them and make full use of their strong points as employees need to be considered as competitive advantages and real assets of the organization and all the principles of scientific management are properly implemented simultaneously. Since these methods bring its benefits depending on different situations and context and also on some particular sorts of organization, it is recommended that scientific management and human relations approaches should be altered based on the circumstances which a company are facing with a view to making it suit the operation of the company.

To summary, a successful company is the one which use best of two approaches. APPENDIX * The application of Maslow’ theory in a number of companies: Maslow’s Hierarchy of Human Needs Self-Actualization NeedsAccomplishment, opportunities for advancement, growth, and creativity | Thomas Monaghan grew up an orphan and never attended college. But his fast-delivery service and his efforts since the firm’s beginnings in 1960 have produced annual pizza sales of more than $1 illion and have moved his Domino’s Pizza into second place in the pizza business, behind Pizza Hut. | Esteem Needs Recognition, approval of others, status, increased responsibilities | When Union Carbide’s CEO asked for volunteers to develop new business ideas, 10% of the 2,000- member specialty chemicals staff signed up.

Some 66 new-venture ideas dreamed up by these volunteers are being studied by Union Carbide. | Social (Belongingness) Needs Acceptance, affection, affiliation with work groups, family, friends, coworkers, and supervisors | Autoworkers at the Fremont, California, assembly plant operated as a joint venture between GM and Toyota are referred to as team members. Team members rotate jobs and work together in an atmosphere of “mutual trust. They produce almost defect-free cars. | Safety Needs Protection from harm, employee benefits, job security | IBM, AT&T, Xerox, and Johnson & Johnson created stress-management programs for employees that include everything from exercise and meditation to counseling and referrals. Physiological Needs Food, water, sex, shelter, and rest | In the early 1900s, Henry Ford aided his employees in satisfying physiological needs by paying them $5 a day—twice the going wage. | Source: Abraham H. Maslow, 1943. “A Theory of Human Motivation,” Psychological Review * The application of other human relation approaches: * Theory Z: Applying to three distinctly different psychological theories.

One was developed by Abraham H. Maslow and the other is Dr. William Ouchi. The third was developed by W. J. Reddin. This is about the management approach which considers employee participation as the key in order to enhance productivity and improve the quality of working life. Characteristics of Theory Z Management Typical U. S. Organization| Theory Z Organization| Typical Japanese Organization| Short-term employment| Long-term employment| Lifetime mployment| Rapid evaluation andpromotion| Slow evaluation and promotion| Slow evaluation and promotion| Specialized careerpaths| Moderately specialized career paths| Non-specialized career paths| Explicit control mechanisms| Implicit, informal control with explicit, formalized measures| Implicit control mechanisms| Individual decision making| Collective decision making| Collective decision making| Individual responsibility| Individual responsibility| Collective responsibility| Source: G.

Ouchi and Alfred M. Jaeger, 1978. “Type Z Organizations: Stability in the Midst of Mobility,” Academy of Management * Expectancy theory: Developed by Victor H. Vroom (1964). This theory claims that an individual tend to act in a certain way according to his/her expectation, in which he/she is motivated to follow a particular behavior which result in the outcomes that will attract his/her behavior. It comprises 3 variables: * Expectancy or effort-performance linkage: Making a given amount of effort will result in a certain level of performance. Instrumentality or performance-reward linkage: Performing at a particular level is a method which assists obtaining the desired result. * Valence or attractiveness of reward: The importance of potential outcome as well as reward acquired on the job towards the individual. This considers the objectives and needs of individual simultaneously. Expectancy Model Source: H. G. Heneman III and D. P. Schwab, 1972. “Evaluation of Research on Expectancy Theory Prediction of Employee Performance,” Psychological Bulletin * Equity theory: Developed by J. Stacey Adams.

Employees compare what they benefit from the job (outcomes) related to what the put into It (inputs) and then compare their inputs-outcomes ratio with relevant others’ ratio. If the ratio is equitable, there’s no problem here. Conversely, if the ratio is under-rewarded or over-rewarded, it will cause unfair situation. The workers will inevitably feel disappointed and then leads to the appearance of negative actions. Equity Theory Relationships Perceived Ratio Comparison| Employees Assessment| (Outcomes A/Inputs A) < (Outcomes B/Inputs B)| Inequity (under-rewarded)| (Outcomes A/Inputs A) = (Outcomes B/Inputs B)| Equity| Outcomes A/Inputs A) > (Outcomes B/Inputs B)| Inequity (over-rewarded)| # Person A is the employee, and person B is a relevant other or referent| Source: L. Berkowitz ed. , 1965. “Inequity in social exchange,” Advances in Experimental Social Psychology, 2. REFERENCES * L. Berkowitz ed. , 1965. “Inequity in Social Exchanges,” Advances in Experimental Social Psychology, 2, pp. 267-300. * Cary L. Cooper, Chris Argyris, William Starbuck. eds. , 2004. The Blackwell Encyclopedia of Management. * Herzberg, F. , 1968. “One more time: how do you motivate employees? ,” Harvard Business Review, 46 (1), 53–62. H. G. Heneman III and D. P. Schwab, 1972. “Evaluation of Research on Expectancy Theory Prediction of Employee Performance,” Psychological Bulletin, pp. 1-9. * Marcouse, I. et al. , 1996. The Complete A-Z Business Studies Handbook, Hodder & Stoughton. * J. & Davis, K. , 1993. Organization Behavior: Human Behavior at Work. New York: McGraw-Hill. * Abraham H. Maslow, 1943. “A Theory of Human Motivation,” Psychological Review, pp. 370 – 396. * William G. Ouchi and Alfred M. Jaeger, 1978. “Type Z Organizations: Stability in the Midst of Mobility,” Academy of Management, Review 3, pp. 08-311 * Stephen Robbins et al. , 2003. Adapted from Management *  Hackman J. R. , & Oldham, G. R. , 1976. “Motivation through design of work,” Organizational Behavior and Human Performance, 16, pp. 250–79. * Frederick. W. Taylor, 1911. The Principles of Scientific Management. Available at: http://www. netmba. com/mgmt/scientific/ [Accessed at 7 April 2012]. * University of Bedfordshire, 2010. A Person Custom Publication, pp. 90-91 [Textbook] * Mc Donald’ corporate website, 2008. Available at: http://www. mcdonalds. com [Accessed at 7 April 2012]

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