ORGANIZATION THEORY
SWRK 4013: Social Welfare Administration
Dr. Rashmita Ray
Assistant Professor
Deptt. of Social Work
Mahatma Gandhi Central University, Motihari, Bihar
Dated: 07 April 2020 (Covid-19 Period)
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Classical Organizational Theory, Slides of Management Theory
It will explain the Classical Organization Theory and Neo-classical Organization Theory.
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ORGANIZATION THEORY
SWRK 4013: Social Welfare Administration
Dr. Rashmita Ray
Assistant Professor Deptt. of Social Work Mahatma Gandhi Central University, Motihari, Bihar
Dated: 07 April 2020 (Covid-19 Period)
CONTENTS
Organization Theory - Concept
Objectives or usefulness of organization
Different Organization Theories
1. Classical Organization Theory
2. Neo-classical Organization Theory
3. Modern Theory
Features of a Mechanistic vs. Organic Organization
Organization Theory: Objectives
The basic objective of organization theory is to –
- furnish a general frame of reference for understanding and
explaining behaviour patterns in organizations, and
- for providing scientific basis for managerial actions concerned
with predicting, controlling and influencing these behaviours, with a view to improve organizational effectiveness
- It helps managers in exploring, analyzing and explaining what is
happening in the organization
- In a real sense, organization theory can make a manager more
competent and more influential. Understanding how and why organizations act, lets managers know how to react.
Key Pillars or Characteristics of
Organisation Theory
Division of labour (tasks & sub-tasks)
Scalar & Functional Processes (deals with vertical & horizontal
elaboration and growth of an organisation)
Structure (refers to the framework of formal relationship
among tasks & activities)
Span of Control (refers to the number of subordinates a
manager can supervise effectively)
Classical Organisation Theory
- The classical writers have viewed organisation as a machine and persons as different components of that machine
- The classical theory has its origin in the writings of Taylor. However the main ideas of this theory have been developed by Mooney , Brech , Allan and Urwick.
- As per classical theory, where organisation is treated as machine, the efficiency of the organisation can be increased by making each individual efficient in it. For instance, Taylor emphasized on division of labour, fixing everyday’s work etc.
- The emphasis is more on specialization of performance and coordination of various activities.
- Classical theory completely ignores the human aspects of organisation and deals exclusively with the formal structure that should be in an organisation.
Criticisms of the Classical Theory
Lack of Universality
Unrealistic Assumptions
Organisation as a closed system, which once created will work smoothly Static view of organisation Considers human beings as inert machines People at work can be motivated only through economic rewards
Excessive reliance on the strength of key pillars ( excessive division of work leads to de-personalisation )
Bureaucratic Behaviour (mindless and strict adherence to rules & regulations)
Neglect of Human Factor (no room for emotions & no consideration of the informal relations or influence of informal groups on performance)
Little scope for integration (of people with organisation – decision-making is done by the top without consultation with the subordinates)
Difference between Classical & Neo-classical Theory
BASIS CLASSICAL NEO-CLASSICAL
Structure Impersonal, Mechanical Organisation is a social system
Focus Focus is on work and economic needs of workers
Focus is on small groups, on emotional and human qualities of employees Emphasis Emphasis is on order & rationality
Emphasis is on personal, security & social needs of workers while achieving objectives of the organisation Behaviour Organisational behaviour is a product of rules and regulations
Behaviour is a product of feelings, sentiments and attitudes
Practices Authoritarian practices , elaborate rules & regulations to obtain results
Democratic practices. Participatory decision-making; recognizes the importance of human dignity and values Results Work alienation; dissatisfaction Happy & satisfied employees trying to increase production
Propositions of the Neo-classical Theory
- Organisation as a social system composed of several interacting parts
- The social environment affects the performance of people and is also affected by them
- Informal organisation also exists and it affects and is affected by formal organisation
- Integration of organizational and individual goals
- People are inter-dependent and their behaviour can be predicted in terms of social factors
- Money is only one of the motivators but not the sole motivator. Men are diversely motivated and socio-psychological factors are more important
- Two-way communication is essential for the smooth functioning of the organisation
- Team work is necessary for higher productivity
Modern Organisation Theory: Concept
Modern Organisation Theory is of recent origin having developed in the sixties and flourished in the seventies.
This theory has an analytical base, and relies on empirical research and above all has integrating nature. It is highly constructive.
It views the organisation as a system and studies it in its totality as a complex system of human relationships.
The theory gives answers to many complex questions ignored by classical or neo-classical theorists. The important questions are – a) What are strategic parts of the system? b) What is the nature of their inter-dependency? c) What are the processes which link various parts of the system and facilitate their adjustment to each other? d) What are the goals of the system?
Modern Organisation Theory Organization as a Social System
1. What are strategic parts of the system?
Individual Formal organisation Informal organisation Status and roles Physical setting & environment
2. What is the nature of their inter-dependency?
All the parts function unitedly, cooperatively, and in collaboration with each other
3. Linking Process
Communication Decision-making Balance
4. Goals
Features of a Mechanistic Organisation
“A mechanistic organization is a rigid and tightly controlled structure...
It is characterized by high specialization, rigid departmentalization, a
limited information network (mostly downward communication),
narrow spans of control, little participation in decision making by
lower-level employees, and high formalization.
Mechanistic organizational structures tend to be efficiency machines
and rely heavily on rules, regulations, standardized tasks, and similar
controls. This organizational structure tries to minimize the impact of
differing personalities, judgments, and ambiguity, because these
human traits are seen as inefficient and inconsistent.”
( Robbins et al: 2013 )
Features of an Organic Organisation
“In direct contrast, organic organization is as highly adaptive and
flexible a structure as the mechanistic organization is rigid and stable.
Organic organizations have a division of labour, but the jobs people
do are not standardized. Employees are highly trained and
empowered to handle diverse job activities and problems, and these
organizations frequently use cross-functional and cross-hierarchical
teams. Employees in organic organizations require minimal formal
rules and little direct supervision; instead, they rely on a free flow of
information and a wide span of control. Their high levels of skills and
training and the support provided by other team members make
formalization and tight managerial controls unnecessary.”
( Robbins et al: 2013 )
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