eng'g management chapter 1

Engineering Management

IE 422

General Objectives:O To discuss and understand the

fundamental concepts and philosophy of management

O To become effective managerO To provide the student with an

elementary knowledge of the functions and process management work

O To provide the student with a knowledge of the functions and process of management work

EVOLUTION OF

MANAGEMENT THOUGHTS

THE SPEED OF THE CANOE DOESN’T COME FROM ITS

WOOD, BUT FROM THE PILOT’S SKILLS AND WIND

DIRECTIONS

Management• It denotes both a function and the people who

discharge it. It also denotes a social position and authority, but also a discipline and a field of study. (Drucker, 1977)

• It’s a process by which a cooperative group directs action toward common goals (Massie 1964)

• Its getting things done through other people (Massie 1964)

Management• It is unifying and coordinating activity

which combines the actions of individuals into meaningful and purposeful group endeavor (Mahoney 1961)

• It’s a technique by means of which the purposes and objectives of a particular human group are determined clarified and effectuated (Petersen et al, 1962)

Management• Identified with the direction of

individuals and functions to achieve ends previously determined (Piffner et al 1953)

• It’s the accomplishment of desired objectives by establishing an environment favorable to performance by people operating in organized group (Koontz 1964)

Management• It’s a distinct process consisting of

planning, organizing, actuating and controlling, performed to determine and accomplish the objectives by the use of people and resources (Terry 1982)

• Management is task. Management is a discipline, But management is also people (Drucker, 1977)

Management• Identified with the direction of

individuals and functions to achieve ends previously determined (Piffner et al 1953)

• It’s the accomplishment in desired objectives by establishing an environment favorable to performance by people operating in organized group (Koontz 1964)

Management• It’s a distinct process consisting of

planning, organizing, actuating and controlling, performed to determine and accomplish the objectives by the use of people and resources (Terry 1982)

• Management is task. Management is a discipline, But management is also people (Drucker, 1977)

Dimensions of Management• To think through and define the specific

purpose and mission of the institution, whether business enterprise, hospitals or university

• To make work productive and the worker achieving

• To manage social impact and social responsibilities

(Drucker, 1977)

Organization• Social group of individuals deliberately

created and maintained for the purpose of achieving specific objectives

• Generally, organizations may be classified into private, public, church or military.

(Drucker, 1977)

Management as an ART and SCIENCE

• Management is an art because its applying skills and knowledge and accomplishing an end through deliberate efforts.

• Management is a science because it involves seeking new knowledge through the use of rigorous method of collecting data, classifying and measuring it, setting up hypotheses, and testing those hypotheses.

• Frederick Taylor who is regarded as the “father” of scientific management stressed the “need for developing mutuality of interests between management and labor, a harmonious cooperation and that in all problems of management the human element is the most important one”

(Koontz et all, 1981)

• Henry Gantt emphasized the importance of time and cost in planning and controlling work and from this he developed a management technique for management information. This is popularly referred to now as the Gantt Chart and is said to be forerunner of the PERT

• The scientificity of management has been further enhanced by the contribution of Frank Gilbreth who introduced motion studies; Karl Person, who developed management statistical techniques; Mary Parker Follet, who emphasized the value of human relations to the basic principles of organizations; Chester Barnard, who stressed the sociological aspects of management and D.B. Dantzig, who developed the basis for the practical application of linear programming.

• Henri Fayol, regarded as the “father” of modern management, suggested that all activities in an industrial undertaking may be divided into groups, namely:• Technical (production, manufacture,

adaptation)• Commercial (buying, selling, exchange)• Accounting (stocktaking, balance sheet,

costs, statistics)• Managerial (planning, organization,

command, coordination, control)

• To forecast and plan (examining the future and drawing up the action plan)

• To organize (building up the structure, material and human, of the undertaking)

• To command (maintaining activity among the personnel)

• To coordinate (binding together, unifying, and harmonizing all activities efforts)

• To control (seeing that everything occurs in conformity with the established rule and expressed command)

Elements of Management

• Contigency Response• Managers are made managers because they are

expected to go into action when needed. • This means they must have the ability to cope

with potential or actual threats to the business• They must respond quickly to risks with

contingency or standby plans or quick action borne from experience or right hunches

What Managers Really Do

• Uncertainty Reduction• Managers are also made managers because they

are expected to reduce uncertainties, risks or threats to the business

• They are capable of changing the organization with purpose and deliberate actions

• They reduce the unknowns

What Managers Really Do

Patterns of Management Analysis

• This school analyzes management through experience. It heavily uses cases in its study of management.

• As a study of experience, it draws generalization but usually as a means o teaching experience, to the practitioner or to the student.

The Empirical School

• This school considers management as a series of decisions and the analysis of decisions as the central function of management.

• It concentrates on the development of rational decision-making in organizations- selection from possible options of a course of action.

• The school emphasizes the importance of the decision itself, the person or group making the decision, and the process of decision-making.

The Decision Theory School

• This school considers management as a system of mathematical models and processes.

• It expresses management problems into goals and objectives and derives factor relationship and combinations which could possibly optimize the stated goal or objective if the organization

The Mathematical School

• A system may be defined as a set of interacting elements bound together by a common objective and operating within a given environment.

• It looks management as a system operating within an internal and external environment

• Management is viewed to be divided and composed of subsystem such as systems of planning, organizing, controlling, budgeting, staffing, monitoring, decision-making.

The Systems School

• The school analyzes management from the standpoint of interpersonal relations represented by human relations, leadership, and behavioral sciences.

• This school is anchored on the belief that management is founded on delegation, that is, “getting things done through others.”

The Human Behavior School

The Hawthorne Effect

O The result of an experiment conducted at the Hawthorne plant of Western Electric in Cicero, Illinois in 1924. They lowered the lighting in the factory, expecting productivity to fall; but instead, to their astonishment, productivity increased.

O The researchers concluded that productivity rose because workers worked harder when they received attention. This phenomenon, in which change of any kind increases productivity, has been known as the “Hawthorne Effect.”

The Social System School

O This school looks at management as a social system and consider the organization primarily as a social organism subject to pressures and conflicts which come from the social environment.

O Its basic tenets include the concepts of cooperation, adaptation, segregation, and differentiation

The Socio- Technical System School

O It was E.L. Trist (1951) of the British Tavistock Institute who developed this school. In his studies of the production system of coal mining, he found out that the cooperative social system was not enough to solve the problems of productivity. Instead, the fitting of the technical system in the production and the behavioral system of the workers was necessary.

The Situational School

O Also known as the Contingency Approach, this school emphasizes the fact that the practice of management depends upon a given set of circumstances.

O This school has largely contributed to the development of such management approaches as brand management in marketing, product management in pharmaceuticals, account management in banking, client management in service organizations, and project management in engineering and development of undertakings

The Managerial Roles School

O Popularized by Henry Mintzberg of McGill University, this school focuses on the activities or roles that a managers do in organization. Mintzberg (1973) analyzed the roles and activities of five chief executives and came to the conclusion that managers do not really act on the basis of the classical functions of management but instead engage in various roles but which may be summarized into three, namely: (1) interpersonal roles, e.g leader, (2) informational roles, e.g communicator; and (3) resource allocator, e.g, entrepreneur

The Operational School

O This school consider management as a universal process and analyzes management through the functions of management namely, planning, organizing, staffing, directing, motivating, and controlling.

O It draws together the concepts, principles, theories, and techniques of management through the actual practice of management in organization

O In general, there is no single effective school of management, although one approach may appear to be useful in solving a number of problems in a number of management situations. It is essential to remember that each schools has its own strong and weak points. It is therefore advisable to be equipped with knowledge of the battery of schools in order to be wholistic and integrative in perspective.

O If the central element in organization is management, the central character in management is the manager. Drucker has considered the manager as the dynamic element in every business organization.

O Manager does not practice management in a vacuum. He operates within an internal and external environment.

The Manager and His Environment

O The internal environment which includes both physical and non-physical factors are controllable by the manager in a relative sense

O The external environment in which the manager also interacts is more complex.

O The interaction of the manager with the external environment is premised on the ff:


O The organization being managed draws various kinds of inputs from the environment such as human, capital, managerial, materials, technology and other resources

O The organization services market demands and protects legitimate rights of interested parties such as employees, consumers, suppliers, investors, the government, among others

O The organization affects the environment conversely as the environment affects the organization


O Economic EnvironmentO The economic system itself constitutes the economic

environment. O The demand, supply and prices of commodities,

products, and other inputs generally are the major concerns of the manager in the economic environment.

O Most of the tactical and strategic decisions of the manager hinge on rents or costs of land, wages of labor, interest rates of capital or money, costs of rated of energy, costs of materials and machines, among others

External Environment on the other hands may be summarized as follows:

O Technological EnvironmentO Technology is referred to as “ the sum total of

knowledge we have of ways to do things” (Koontz et al, 1981)

O It includes inventions, techniques, and the vast store of organized knowledge about everything. But its main influence is on ways of doing things, on how we design, produce, distribute, and sell goods as well as services

O The real impact of technology is on new products, new processes, new machines, new tools, new materials, and new services.


O Social EnvironmentO The social environment is made up of

attitudes, desires, expectations, degrees of intelligence and education, beliefs and customs of people in a given group or society

O At present, the social environment is a factor that managers cannot easily dispense with. In fact modern managers have to take this factor seriously.


O Political EnvironmentO The political environment is intertwined

with the social environment but the two can be conceptually differentiated.


O Crusading StageO This is the stage of startups and the

beginning of the movementsO It may begin with a charismatic leader

capable of mobilizing forces from the countryside or from the urban poor or a combination of both

O It may be a people’s movement without any apparent singular leader in the beginning until one emerges from the conflict

Management of Revolution

O Popular Movement StageO The charismatic leader and his movement

must now become populist and involve the largest number of people possible

O They zero in active supporters, optimizing their participation, go after potential followers, and either ignore or confront the opposition directly or indirectly


O Managerial StageO As the movement moves into a position of

advantage against all oppositionists, it must be settle down into a purposeful large-scale organization for change

O It must be managedO The leader and the followers, and their army

of supporters must have unity of action backing up their unity of goal


O Bureaucratic StageO This is the last phase of the cycle when the

leaders and cadre revolutionary movement have totally transformed themselves from high-spirited crusaders in the first stage to a very large, heavy and cumbersome bureaucracy.
