U1 Flashcards
An organizational process is the means by which management ?
rallies together labor resources, materials, technology, information, and people to achieve its business goals and objectives.
An effective organization is usually defined as?
an association which:
-ensures optimal use of its resources,
-minimizing production loss and disruption in the interaction between different organizational units
-and avoiding breakdowns in communication channels.
It is generally accepted that specialization and division of labor underlie the concept of?
organizational efficiency and business growth.
Historically, maximizing efficiency has led to the most important achievements in the ————————————— and its derivatives.
development of performance
Different models of enhancing and managing performance have led to an increase in ?
production efficiency, which has changed the very nature and quality of modern society and the global balance of power in the business world.
The methods for achieving high performance do not only consider ————- ——— (resource) processing, which contributes to the success of the——————– ————(output),
but also organizational activities and components, including using——————————————————————————————————————————.
optimal input
final product
technologies, a manufactured design, and a structure of work as well as a different influence of external factors and environment.
Performance measurement can be defined as a?
process by which businesses, governments, and other organizations set up certain criteria for measuring the quality of their activities based on organizational goals (i.e., standards).
It involves creating a simple but effective system for ?
determining whether organizations are able to meet their objectives.
Examples from business might include
increases in turnover and profit,
reductions in production costs,
and decreases in the time period required to process customer orders.
The reason for considering all these examples is?
to explain that the result can be measured quantitatively.
Effective performance measurement requires ?
quantitative evidence (for an association) to determine organizational progress toward achieving its goals.
Søren Kierkegaard once uttered the famous phrase:
“Life can only be understood backwards, but it must be lived forwards.”
What is true for life also applies to science and research. Hence, to understand the background of performance measurement theory-where it comes from and where it is going-we need to
-first look at a taxonomy of broad management theories based on a chronological approach.
This includes six main concepts, which we will specify and discuss in the following sequence:
=Theory of scientific management (1885–1920)
=Theory of administration (1920–1950)
=Human relations movement\/neoclassical management (1930–1950)
=Behavioral management theory (1950–present)
=Theory of quantitative management (1950–present)
=Strategic management theory (1970–present) and its modern manifestations such as ‘total quality management’, ‘competitive advantage strategy’, a concept of ‘customer relationship management’ and ‘consumer-oriented management’, etc. (2000–present).
These concepts will not only help you to understand performance measurement, but are also the foundation and background for other theories in management accounting and corporate finance.
Theories Before 1950
The first four theories of management from a chronological perspective are based on ?
behaviorist approaches to management.
Quantitative and strategic management concepts are based on?
quantitative analysis and assessment of effective management with the intent to achieve performance excellence.
Management practices have evolved throughout history. It is well known that different types of organizations already existed in ancient times. But before the 20th century, there was no —————- for explaining exactly what makes a management process —————and what improves performance ——————–.
clear-cut framework
effective
systematically
Theory of Scientific Management
Effective management and issues of high productivity in commerce and business organizations only became a subject of serious studies at the
20th century after the publication of F. Taylor’s ‘Principles of Scientific Management’.
Since that time, efficiency and performance in management have become?
an independent area of research and a recognized science.
Frederick Taylor and his theory of scientific management began the era of ————–management and ——————— in manufacturing.
He advocated for?
modern
efficiency
training the workforce
and developing ‘a hearty cooperation’ in the production process.
That alone already represented a significant improvement over the feudal human relations of the time.
At the dawn of the 20th century, Frederick Taylor accurately defined
poor administration
and inefficient or ill-directed management
as a ?
national loss.
Principles of efficient (rational) management in the manufacturing process laid the foundation for theories of ?
scientific management.
But the main focus of scientific management was on ?
the lowest level of the organization-a worker and his supervisor-where attention was directed towards how to make the work of this production unit more efficient.
The key elements in the theory of rational management were?
standardization, rationalization, specialization, and intensification of work.
F. Taylor, G. Gantt, and F. Gilbert suggested?
different quantitative measurements to determine the best options for boosting performance of specific manufacturing operations.
This has led to increased?
specialization,
productivity,
and efficiency of resource management.
The planning process, however, has been separated from?
the implementation of plans while increased standardization of manufacturing processes has led to the alienation of workers from the organization and its objectives.
Henry Ford introduced a modified concept of
—————- management, which included ?
scientific
a systematic approach towards personnel management.
a systematic approach towards personnel management, with the idea of?
-shared responsibilities between workers
-and managers in providing a workflow of high quality and efficiency for the organization as well as the idea of a scientific setting of labor quotas.
He developed the principal ideas of a hierarchical structure of?
the organizational management, which were then further formulated by Henry Fayol and Max Weber in its definite form.
Taylor’s and Ford’s theories laid the foundation for ?
the development of concepts of how to organize large-scale machine production, which in turn determined frameworks for a model of coordination of modern enterprises.
Max Weber introduced a concept of an ‘ideal’ model of?
bureaucratic organization focused on the administrative hierarchy and specialization of labor.
Weber postulated that western civilization was shifting from? to?
‘wertrational’ (or value oriented) thinking, affective action (action derived from emotions) and traditional action (action derived from past precedence)
to ‘zweckrational’ (or technocratic) thinking.
According to Max Weber, western civilization was changing in order to?
seek technically optimized results at the expense of emotional or humanistic values.
Witnessing the growth of large-scale organizations of all types at the turn of the late 19th and early 20th century, Max Weber devised ?
a set of principles for an ‘ideal’ bureaucracy.
He believed that activities and performance of organizations are carried out in accordance with?
a coherent system of certain rules and principles.
These principles include:
=fixed and official jurisdictional areas,
=a firmly ordered hierarchy of supremacy and subordination,
=management based on written records,
=thorough and expert training,
=official activity taking priority over other activities.
These measures result in a principle of leadership within a given company which follows stable and knowable rules, especially in recruitment, promotion of employees and staff dismissal.
Weber did not advocate bureaucracy; however, he envisioned the bureaucracy as ?
a large machine for attaining the objectives of an organization in the most efficient manner possible.
It should be emphasized that different concepts of scientific management engaged primarily in a study of?
processes of manufacturing management, not taking into account the management of the organization as such.
But in general, scientific management’s organizational influences contributed to?
the development of the field of industrial engineering, personnel, and quality control.
Theory of Administration
Between —————————–, a rational approach in management focusing on the ——————– was slowly replaced by a ——————–approach, or what is well-known today as ————————— management, relating to the issues of——————————————————————————————————————-.
1920 and 1950
production cycle
‘classical’
administrative
improved governance and administration at the level of the organization as a whole
The development of the classic theory of administration (classical management) is primarily associated with———————————————————————————————————————-and gives priority to the concept of ‘efficiency’ in relation to the function of the organization as a whole unit.
the names of Henry Fayol, Lyndal F. Urwick, J. D. Mooney, A. C. Railey, and Alfred P. Sloan
The theory of classical management mainly focuses on?
the need to formulate the organization’s objectives and describes the functions of management such as planning, organization and control.
Classical (administrative) management emphasized ?
the main five principles of organizational management,
Classical (administrative) management emphasized the main five principles of organizational management, which were put by?
Fayol
Classical (administrative) management emphasized the main five principles of organizational management, which were put by? Fayol as follows:
‘plan’, ‘organize’, ‘command’, ‘coordinate’, and ‘control’.
Planning is?
the act of anticipating the future and acting accordingly.
Organization is?
the development of the institution’s resources, both material and human.
Commanding is?
concerned with keeping the institution’s actions and processes running.
Co-ordination?
indicates the alignment and harmonization of the groups’ efforts.
Finally, control implies that?
the above activities were performed in accordance with appropriate rules and procedures.
In his book, ‘General and Industrial Management’, H. Fayol proposed fourteen principles of administration to go hand in hand with ?
management’s five primary roles.
These principles are as follows:
=Specialisation/division of labor
=Authority with responsibility
=Discipline
=Unity of command
=Unity of direction
=Subordination of individual interest to the greater interest
=Remuneration of staff
=Centralisation
=Scalar chain\/line of authority
=Order
=Equity
=Stability of tenure
=Initiative
=“Esprit de corps”
Fayol clearly believed that?
personal efforts and team dynamics were part of an ‘ideal’ organization.
He drew attention to ?
the importance of team spirit as a key to efficiency.
In addition, Fayol always stressed the importance of specialization to ensure optimal use of?
human resources, but also warned that specialization must have its limits.
The theories of scientific management and administration became a theoretical basis for?
the formation of a mechanistic model of the organization.
The theories of scientific management and administration became a theoretical basis for
the formation of a mechanistic model of the organization. However, this particular type of model only exists in practice when?
when the market and the technological environment are stable and predictable.
In this case, an organization is seen as a?
mechanism
which combines basic factors of production: production
and capital goods,
labor
and raw materials.
This mechanistic model allows technical and economic relations to be established and reveals the dependencies between?
the various factors of production.
In this model, the organization is a?
closed autonomic system with fixed boundaries which is relatively independent of the external environment.
Management of the organization in such systems is invariably directed towards?
operational management and the role of the human factor is not considered when attempting to improve performance and increase organizational efficiency.
The Human Relations Movement
A new direction in management-the neoclassical management ?
(the theory behind the human relations movement which replaced the classical administration)-emerged in the 1930s.
the neoclassical management ?
This theory adopted the achievement of sociology and psychology and used them as tools.
