Download The Captivity of the Principles and Functions of Classic

The Captivity of the Principles and Functions
of Classic Management, and Contemporary
Innovative Management
Assoc. prof. Gheorghe SĂVOIU PhD
Assoc. prof.Maria Carmen MANEA
University of Piteşti
Abstract
This paper isfocused on the idea that principles represent, in any
science, fundamental theses or expressions, basic ideas underpinning any
scientific theory, any practicai system or efficient organization. A set of
fundamentals of general economics are always behind any principled and
theoretical developments of practically all sciences branching from the
vital and so generous tree of economics. The principles of the modern
market economy, in their deeply axiomatic and comprehensive capacity,
through a statement worthy of the terse spirit ofGreek classicism, but also
adequate to today's scientific teminology, have been formulated by James
D. Gwartney and Richard L. Stroup in remarkable and perennial wording.
Contemporary management has become, and is expanding, as innovative
management in compliance with classic managerial principles and
functions, while also developing further principles and constantly adapting
to the new global and the new economic realities.
Key words: management principles, management functions,
innovative mangement, managerial innovation.
The principles formulated by James D. Gwartney and Richard L.
Stroup rebuild, easily and in all simplicity, in only ten major precepts, its
actual mechanism. Thus, starting from the fundamental dynamic principie
"incentives matter", and from the fact that "nothing comes free", the rest
connects naturally, redefming transactions, absolute and relative
advantages, as well as their role in "voluntary exchange [that] promotes
economic progress", the liberalization of exchange and the efficiency of
approach by "transaction costs are a barrier to the exchange, and reduce
these barriers will help to promote economic progress", alongside of the
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natural correlations of the type of "real income growth is dependent on the
increases in real output", factorially dividing the same real income, as in the
expression "the four sources of real income growth remain upgrading the
workers' skills, capital formation, technological progress and better
economic organization", and the simple causal relationship that
incorporates it: "the income is the pay obtained for having provided
services desired by the others ", withut omitting the purpose of economic
activities, as "profits orient the economic enterprises towards those
activities that increase wealth", and then revealing the importance of price
as the invisible hand of the economy, in the sense given by the father of that
science, Adam Smith, author of "The Wealth of Nations", the "principie of
the invisible hand harmonizes self-interest with the general welfare", and
ending with the threat of cyclical recession, which lurks anywhere, anytime,
by emphasizing the importance of forecasting and the economic impact of
decision, through the statement that "the commonest source of error in
economics is ignoring the side effects and long-term consequences. "
The diversity, and the principle-oriented and the functional
captivity of contemporary management
The evolution of management, as a science initially deriving from
applied market economy, naturally assumed a plurality of practicai
manifestations, which overlapped chronologically; the diversely weighted
eclecticism technology-people is the main cause of this distinct pattern of
evolution of theories, which gives it a substance apparently lacking
consistency or interdisciplinary connections, although it is clear that its
contemporary approach is a integrative, holistic, multi-theoretical and
scientific. The managerial principles are, by contrast, the evidence of the
coherent, temporally evolutionary and integrative character, in the
multidisciplinary plane, and bring together fundamental elements and laws,
on which management is based as a scientific theory.
The number of managerial principles that should underpin the
activities of organizations has been placed within a fairly wide range, right
from its synthetically enumerative debut, the lower limit being that of the
principie management quadrilateral of Frederick Taylor, which combined
the development of the science of individual work, through the detailed
analysis of each constituent (each 'movement' or duty of the job
description), followed by carefully identifying the optimal method of
transposition and generalization in the practice of the organization, with a
rigorous selection and training of workers (the staff), with the extended
mutual cooperation, methodological and substantive, between manager and
workers (the subordinate group), and an additional internai division of
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labour, a new structural split of activities and a novei funcţional assignment
of responsibilities between managers and workers (or groups of
subordinates), while its upper limit reached not less than 14 general
principles of management and management, enunciated by Henri Fayol namely the division of labour (or division of work), authority, discipline,
unity of command, unity of direction, subordination of individual interest,
remuneration, centralization, scalar chain, order and adequacy of resources
(or order), equity, stability of functions and personnel (i.e. stability of
tenure), stimulating initiatives (or iniţiative), team spirit and organization
membership (or esprit de corps). Over the course of almost one hundred
years, many of the early management principles would disappear, others
would apparently change their form, but not their essence, appearing by
new names, and many others would add to the already historic fund of the
remaining managerial principles.
The diversity of manageial principles, as a fundamental feature of
contemporary economic management, extends methodically and covers an
increasing area, while the new principles, accents and changes of
perspective can be described as being relevant features of contemporary
management.
New principles, contemporary accents and shifts of perspective
in management
Some of the new features related to principles and some of the
original accents appeared in modern management are described briefly
below:
− diversification of incentives and careful time monitoring
(Henry Gantt),
− raţional authority, the basis of the organization, formal/legal
power invested in the manager, the hierarchy of authority
and responsibility, using the written memory of the
organization, impersonal rules and procedures that are
however applied uniformly, continuity centred on formal
structures and positions, the split between management and
the owners of the organization (Max Weber ),
− the importance of common major objectives in reducing
conflicts in the organization, encouraging employees rather
than controlling them (Mary Parker Follett),
− the potential presence of the informai organization in the
formal organization, freedom of will and choice of the
authority (Chester I. Barnard),
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− motivation as a result of satisfaction of personal economic
needs, of social needs, job satisfaction (Elton Mayo),
− the importance of ensuring the Hawthorne effect, whereby
workers enjoy special attention: they will get better results
thanks to the very fact that they are treated in this way, and
improving human relationships, relationships that are the
best approach to labour productivity growth (Richard Daft)
− the managers' ability to identify the key variables (or
contingencies) of a specific organizational situation (Richard
Daft)
− amplifying the importance of designing the posts so as to
meet the individuals' higher order needs, providing
employees the opportunity to fully utilize their full potential,
reducing the influence of "hygienic or maintenance" factors,
which result in dissatisfaction and are extrinsic to the job. as
well as increasing the influence of "motivating or growth"
factors, which generate satisfaction and are intrinsic to the
job (Abraham Maslow, Frederick Herzberg),
− the increase of the weight of psychology and sociology in
analyzing motivation, communication, leadership and the
full spectrum of human resources (Doulgas McGregor,
Rensis Likert, Chris Argyris),
− exacerbation of systemic significance, alternating, in point of
importance, the integrality, hierarchy, dynamism, purpose
and adaptability of management (Herbert Simon, Peter
Drucker, Michael Porter, Charles Handy),
− the more generalized perspective of using mathematical and
statistical concepts and methods, addressing, in a
mathematized manner, the forecasting and organization
functions, the functions of research and development,
production and trade (Alan Kaufmann, John von Neumann,
Oskar Morgenstern),
− amplification of the iterative and cyclical nature of the
management process (Harold Koontz),
− the increased significance of challenges in the environment
of the organization, the increased importance of the group /
team (Noel Tichy)
− generalizing the importance of quality (Joseph Juran,
Edward Deming, Kaoru Ishikawa, Genichi Taguchi),
− excellence of performance (Tom Peters. Robert Waterman),
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− the perspective of sustainable development and
environmental protection,
− extended meanings of re-engineering and e-management,
− conceptual enhancing of managerial organizational culture,
− emphasizing ethics (ethics of the possible, of responsibility,
of persuasion, of rules),
− the perspective of integrating social responsibility, as well as
social sensitivity, among the criteria of the organization,
− highlighting the importance of informai elements,
− new emphasis placed on economy-orientedness, efficiency,
efficacy and effectiveness, etc.
Modern management principles have been, and are continually
being redefined, among many others by Peter Drucker, a leading
management theorist, Nobel Prize winner for economics, by shifting the
emphasis on performance: setting the business objectives, the organization
of production and labour, motivation and communication, establishing
performance measurement methods, and continuous development of
employee performance.
Very much like the principles, the functions of the science of
management are captive to the functions of the economy, even when the
general economy could be restricted to a limited number of functions. In a
funcţional abstract presentation of the economy, some of its descriptive and
defining functions would be:
- the function of demand, where demand, as the dependent variable,
is in direct or inverse relationship with various factors (price of the product,
available income, prices of substitutable products, prices of complementary
products, number of consumers),
- the function of production, in keeping with which there is always
a quantifiable relationship between production and resources, between
outputs and inputs, based on the relative constancy in time of a certain
development stage of technology,
- the supply function, in relation to which the relationship is
described between the quantitative supply, as a resulting outcome, and a
series of factors or independent variables, such as product price, the price of
labour, the capital factor price, the price of other competing products that
can be obtained with the same factors (human resources and capital), the
number of companies that produce the product,
- the consumption function, as funcţional relationship between
incomes and consumption expenditure,
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- the saving function, which is complementary to the function of
consumption (savings represents the excess of income over consumption
expenditure), after which the average growth of savings usually surpasses
the average income growth. and in the case of revenue decrease, an increase
in the share of consumption expenditure occurs in an higher proportion,
- the household utility function, which describes the household
consumption behaviour, as a compound consumption structure, etc.
On a theoretical plane, the functions of management are defined as
variable activities that depend on one or more independent variables sizes,
and in practicai terms, as activities in interaction with other special activities
by their nature and direction, which the manager or management team do
continuously, in a hierarchical, structured manner, for the efficient
management of the organization's system.
The dependency of the management functions on the practicai
organization of the company, business or enterprise is the result of the
interplay between compartmentalization, the structure and the hierarchy of
the organization, which are translated into specific management functions,
assuming that functions are variables resulting from the iniţial project of
management of the organization (in the primary management model), and
the independence of the managerial functions, in relation to the same
practicai organization, is the result of the restructuring of the primary
project.
Two trends characterize the recent approaches to managerial
functions, the first consisting of excessive multiplication, by the gradual
addition of new features, from setting the goals, continuing with motivation,
exchanging views, plan formulation and exercising control, structuring
tasks and decision-making, communication of criticai information, resource
allocation, conflict resolution, delegation of authority, directing the
changes, measurement of results, training the people, innovation and even
decentralization; and the second, which follows a trend of systematic
reduction, either by regrouping, to only four functions, namely planning,
including also decision making, organizing in order to achieve business
performance, leadership (or leading), to which are added motivation (or
motivating), as well as control (or controlling) - after Justin Longeneker and
Charles Pringle, or by reducting to only two functions, deemed essential,
such as the supple and flexible organization and decreasing the size of the
compartments of the organization, including the management one, in the
opinion of Sarah Freeman and Kim Cameron, or restricting everything to a
single function, which is to mobilize the energies of the economic unit to
meet the tasks known and defined. the way that Peter Drucker was able to
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define the essential attribute of management, by using a single, yet
maximally concentrated principie.
Functions of management after Henri Fayol
In its contemporary meaning, innovation or the innovative function
of management must complete the set of the classical functions. being a
more pragmatic solution, or else a solution able to provide a more rapid
management of the organization, transformed into an innovative entity
adapted to the global system of resources and uses. Innovation efforts
become a practicai innovation in terms of management in relatively fewer
situations in relation to expectations, and when they fail, particularly in
managerial processes, the cause is the disparity of managerial decision or
the cultural managerial gap between the aspirations of the manager and the
ability of the organization or entity to understand and apply innovative
management ...
Roy Rothwell, in his book entitled "Managing Innovation and
Change", published in 1991 and reprinted in 2002, 2003 and 2004, makes a
retrospective analysis the innovative process, especially the industrial one
(adapted and integrated into the educaţional process in this synthesis),
identifying as many as five successive generations that have contributed to
the maturation of both the process itself, and its management: a) the
generation of the managers in the first two postwar decades (the first
generation of "technology push", focusing less on the new concept of
research and development, "R&D", which was the beginning of the
implementation of large-scale industrial innovation); b) the generation of
the second half of the 1960s, and also that of the 1970s (a generation faced
with the first rationalizations of technological and financial change, as well
as an increase in the importance of long-term "R&D", but also in the
innovative management processes, according to the relatively late opinions
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in relation to the original staging, i.e. those of Daft, R. L. & K. E. Weick, in
1984, who identify, in practice, four specific entities in relation to the
relationships developed, from those that initiate an "undirected long-term
perspective or view", to those benefiting from „conditioned" strategies, to
the evolved alternative of the entities capable of "managerial insights with
strategic impact", and. finally, those able to "adopt original management
strategies); c) the generation of the 1980s (the innovative axis now
describes managerial innovation itself as a network of adaptation to the
internai and externai environment of the entity, bringing together
companies and organizations, as well as academic and research
communities, in an administrative context - according to Rothwell and
Zegveld, in 1982 and 1985); d) the 1990s generation (where the dominant
processes are computer-assisted management processes, focused on
simulations and databases, innovative managerial technologies, etc., as in
Rothwell's book published in 1992); e) the new generation, after the year
2000 (where internet communication, social groups and networks become
important managerial components in the process, whose significance is
greater and greater, and the new information solutions, focused on tablets
and integrated phones, will probably be gradually assimilable, management
space and time will be dilated, thus resizing the new innovative managerial
processes).
Whatever the number of the principles and however they may be
defined, very much like the management functions, the are not tantamount to
immutable laws or strict temporal sequences of activities, but rather sets in
keeping with the approach to the organization as a system, neither can all be
mandatory, or regrouping, within the same principie or function,
requirements or management activities in strict temporal succession within
the management process. Quite on the contrary, the selected principles and
the adapted functions are needed in any approach to the organization,
company or entity as a system, but in an innovative manner, combining and
clarifying, through continuous adaptation to the internai and externai
environment, forecasting, operaţional, commensuration and interpretation
activities, which can be found in the three corresponding phases of the
management process, which emphasizes the durability or sustainability of a
function, as a process and a principie.
"Change is the law of life. Those who look only to the past or preseni
are certam to miss the future" said, 60 years ago, none other than John
Kennedy. Modern systems management involves a practiced capability to
practically overcome problems by means of compromise, too, and implicitly
has an innovative management component. Promoting creative and
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innovative approaches in various areas of human activity, and contributing to
a better preparation of any organization for the present and future challenges
of a globalized world, and for the knowledge society, where the innovative
management process dominates over the lifetime or demography of the
companies, organizations, associations, according to the famous formulation
of the "life-long learning", which will naturally be valid in future
management, too.
Bibliography
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