Management Theory

Management Theory 

A collection of ideas which set forth general rules on how to manage a business or organization. 

Management theory addresses how managers and supervisors relate to their organizations in the knowledge of its goals, the implementation of effective means to get the goals accomplished and how to motivate employees to perform to the highest standard.

History

The Ford Motor Company was one of the earliest of many automobile manufacturers between the 1890 and 1910.

Ford introduced the Model T after five years of production. The model T was simple and light yet strong enough to be driven in the country road. The mass production of the model T enable it to lowered its unit price, hence making it affordable for the average consumer.

Fordism

In 1913, Henry Ford had an assembly line build in Detroit plant where the model T was manufactured. This marked the beginning of a new era in production called Fordism.

Fordism is based on the system of mass production and mass consumption. The main idea of Fordism was standardisation which means standardised components and standardised manufacturing process.

However, it wasn't long till Fordism as a method for the industrial organisation of production failed. For instance:

1. Workers did not move during their shift
2. Workers performed repetitive movements
3. There was not any prospect of going up the hierarchy therefore lead to no motivation


Post-Fordism

Post Fordism was seen as a direct confrontation with principles of Fordism. It involved the introduction of an increasingly skilled, highly motivated and extremely flexible workforce

The aim was to engender flexibility and innovation through the decentralisation of power.

Post Fordism can be characterised by the the following attributes:

1. Small batch production
2. Economies of scope
3. Specialised products and jobs

Although the implementation of Post Fordism, i believe that some business still uses Fordism with practices of adapting to suit the changing consumer and demand. The important factors to consider when deciding whether business should or not pursue fordist practises should take in consideration of the economy, industry, product, consumer and competitors.

Organisational Design & Structure

              Is an organization well designed? How do we know? What does a well designed organization look like? Therefore this is the types of question that should be discussed when looking at organizational design.   

Organization design can be defined as the process of aligning an organization structure with its mission. This also means that by looking at the complex relationship between tasks, workflow, responsibility and authority and making sure these all support the objectives of the business.  

Good organizational design can increase communication, productivity and innovation in a way. Thus creating an environment where employees can work efficiently.

In addition to that, lack of productivity and performance issue can be link back to poor organization design. For instance, a company whose sales department and production department both work separately. Although so they still have to communicate about customer needs. If both department doesn't cooperate well this also means that the company can be produce products that are not needed by the consumer.

However, without planning an organization design often takes on a hierarchical structure. This is common because business executives and managers can gain control over major decision. Although so, this structure lack of flexibility and and often does get the potential out of their employee. They tend just follow the rules and do whatever the manager or the executive asked. 

Characteristics	Hierarchical structure	Organic structure
Complexity	High-with lots of horizontal separation department	Low-less differentiation or functional separation
Formality	High-lots of well defined lines of control	Lowe-no real hierarchy and less formal division of responsibilities
Participation	Low-employees have low involvement in decision making	High-lower level employees have more influence
Communication	Downward-information starts from the top all the way down to employee	Lateral, upward and downward-information flow better with fewer barriers

                                                                     



                                                                             Matrix Structure

This type of structure combines both tractional departments seen in functional structures with project team. In a matrix structure, individuals work across teams and projects as well as within their own department or function.

For instance, a project or task team is established to develop a new product might include engineers and design specialists as well as marketing, financial and production









In my opinion, organizational design and structure depends on the nature of the company and business. For instance, Macdonalds use the traditional hierarchical structure where the employees at the bottom and the executive all the way at the top. Employees will not have the chance to communicate with the top.