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3 - Theories of Organization.doc

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Public Administration
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Frank Ohemeng

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1 Theories of Organization Agenda: 1. The Study of Organizations 2. Theories used in Analysing Organizations 3. Future of Organizations Studies What is an Organisation? - A group of people who jointly work to achieve at least one common goal. - A consciously coordinated social entity, with a relatively identifiable boundary, that functions on a relatively continuous basis to achieve a common goal or set goals. A Complex Organisation - A complex organisation is an organisation so large and structurally differentiated that it cannot be managed effectively by a single individual - Examples: corporations, government agencies, hospitals, nonprofits, and most voluntary associations. Theories of Organisation - A set of propositions that seeks to explain or predict how groups and individuals behave in differing organisational arrangements. - Organisation theory is therefore, the study of how and why complex organisations behave as they do. - It is the study of formal structures, internal processes, external constraints, and the ways organisations affect and are affected by their members. Subfields of Theories of Organisation a. Organisation Theory - Embraces a macro perspective focusing on the organisation itself as the basic unit of analysis seeking to explain how and why organisations behave as they do. b. Organisational Behaviour - Takes a micro perspective focusing on individuals and groups as the basic units of analysis, and seeking to understand their behaviours and interrelationships. c. Management Theory - Refers to those activities in the larger field of organisational analysis that focuses specifically on management processes and practices. Major Fields in Organisational Theory a. Scientific Management Theory b. Bureaucratic Theory c. Administrative Management Theory d. Human Relations (Resources) Theory e. Systems Theory 2 f. Organisational Culture and Leadership Theory g. Some modern theories We may group these theories into two broad categories: a. Classical b. Neo-classical Theories Classical Organization Theory (still part of first subfield) - The first theory of its kind in the study of organisation. - It is considered traditional and continues to be the base upon which other schools of organisation theory have been built. - There are four fundamental ideas that summarize classical theory: 1. Organisations exist to accomplish production related and economic goals. 2. There is one best way to organise for production, and that way can be found through systematic scientific inquiry/study. 3. Production is maximised through specialisation and division of labour. 4. People and organisations act in accordance with rational economic principles. - The fundamental aspects of COT lies in the formal structure in design and the technical rationality in the processes of organisation toward maximising internal efficiency while, at the same time, maintaining administrative control over organisational members and operations. a. Scientific Management Theory - Frederick W. Taylor is known as the father of Scientific Management Theory - It called for increasing output by systematising work processes, dividing work into narrowly defined tasks, determining the “one best way” to perform each task, training workers in the “one best way”, measuring performance, and offering economic incentives for surpassing daily production quotas. Criticisms - Workers as cogs in the industrial machine: the theory treats workers and machines in the same way, standardising both and running them as fast as possible. - Created a chaotic environment at the workplace between labour and management. Ex: email. b. Bureaucratic Theory *** (also ** for legitimacy) Developed by Max Weber, a sociologist, who lived in Germany, King of Prussia. Weber argued that working to the rules in a hierarchical office in which appointment and promotion are by merit is more rational than making appointments on other basis such as patronage. We say that Weber did not really propose a theory for organisation, his analysis was a descriptive one, and its purpose was limited to defining the essential characteristics of the modern bureaucratic form of 3 administration. According to Weber, the most efficient type of modern organisation to implement public policy as well as the most effective instrument of administrative and political control is the bureaucracy. The ideal bureaucracy is based on legal and rational principles that determine its structural design, operational processes and normative rules/values. This is different from traditional and charismatically run organisations, in which rationality is lost to traditional norms and the personal will of the ruler. Components of Ideal Bureaucracy: 1. Hierarchical structure 2. Unity of Command – one person issuing commands 3. Specialisation of Labour 4. Employment and promotion based on merit – you get employment based on your education, experience, because you are the most qualified 5. Full-time employment – Weber said that people should be employed fully and paid fully, and so people can relay on a full-time salary. 6. Decisions that are made should be based on impersonal rule 7. Importance of written files – everything in the bureaucracy should be written down. Accountability. 8. Bureaucratic employment is totally separate from the bureaucrat’s private life. (Unless the personal life is affecting their productivity at work, and then they may be reprimanded. Ex: alcoholism, 2 job at night – lack of sleep). Bureaucracy belongs to the public. Don’t take your personal life to work. Criticisms: 1. Weber focused so much on the structure of the organisation, at the expense of other important elements in the organisation. 2. The Theory does not take into account the human aspects or the human relations part of the organisation. Bureaucracy dehumanizes organisations. 3. Weber left out the irrational elements affecting the performance of organisations. Example: human emotions. c. Administrative Management Theory - Scholars associated with Administrative Management Theory: Henri Fayol and Luther Gulick. - It holds that organisational performance is enhanced by establishing and adm
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