Bus 1050 1st Edition Lecture 24 Outline of Last Lecture I. Management (Human Resources)II. Abraham Lincoln, Letter to Horace GreeleyIII.Lorimer, from Letters from a Self-Made Merchant to His SonIV.Carnegie, An Employer’s View of the Labor QuestionV.A Few Good Men Outline of Current Lecture II. Taylor, The principles of Scientific Management (in Production section) III. Tawney, The Condition of Efficiency from The Acquisitive Society IV.McGregor, The Human Side of EnterpriseCurrent LectureFrederick Taylor (The Principles of Scientific Management)Since the beginning of time, workers have fought against technological innovation because they assume it will take their jobs, when in reality it’s the opposite. Take the power loom as an example. It was introduced in the 1800s and it made the production of cotton less expensive and as a result, the price fell and more people were able to afford it. The Manchester, England example (5000 to 265,000) goes to show that increases in efficiency creates jobs. It is important to understand how incentives increase efficiency and here Taylor introduces the case of John, the pen maker. John is given an incentive to make more money by making more pens and as a result he is more productive. But management punishes him and the incentive of “more pay” doesn’t work anymore because he believes management will punish him again.We also learn about scientific management. The difference between the selling price and these costs is the surplus. All of these disputes between management and labor are over this surplus. Remember the pie and that each side wants as much of it as they can get their hands on. Scientific management will increase efficiency and lower the cost of production. As a result, the pie will be bigger and now the two sides will be at peace. But we know that this is not the case.These notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.Scientific management: While it genuinely does require new, unheard of duties assigned to management, it is primarily the introduction of “science” into the workplace through the use of time study, motion study, etc. It worked well at the time it was introduced because it satisfied the needs of workers at the time, and these needs were primarily monetary in nature. Tawney (The Condition of Efficiency from The Acquisitive Society)Esprit de corps (take advantage of the professional spirit that is already inside of all of us). The idea behind Scientific Management, to decide step by step, what the most efficient way to get something down, and once we know what’s the fastest…What’s the general approach to structuring a health care system? The objective is to have a minimum healthcare. No one will suffer from some condition that is treatable. The U.S. has an ad hoc health system and it is terribly inefficient. We actually pay more than other countries because we don’t have an effective system. We have workers who know better than management in order to get the job done. Pg. 435 It would be foolish to say anyone is uninfluenced by… It’s not that money doesn’t matter, it’s just that it’s not as important as we deem it to be. McGregor Partly based on Maslow’s hierarchy of needs. It’s important to keep in mind that if you have not satisfied the lower level of needs then the higher level needs do not matter. Everyone in 1916 everyone wanted to work for Henry Ford because Ford paid the most, although the working conditions were terrible. Also, once the lower needs (physiological, safety,etc.) there is no desire to have more of them. He presents theory x and theory y. Conventional view Management is responsible for the efficient use of organizational resources including people.People must be controlled, directed or nothing will get done. Theory XPeople are lazy, have a lack of ambition, etc. and this is why the upper 2 statements are the way they are for the conventional view. Studies have shown that scientists have observed this behavior in industrial organizations. But the belief is that it’s not our inherent nature. Which is the cause and which is the effect? Physiological needs are the same way as physiological needs. Money generally only satisfies the lower level needs. We keep asking for what we think we want, more money, but we it’s really not solving the problem. But what if money is the only thing a company offers. The solution to this problem is to change the view of how we view people and this is known as Theory Y. Here we assume that people are not passably unmotivated. We’ve been made that way. Theory X = management by control Theory Y = management by objective You can’t in a large organization have centralization. Centralization is found in small business because one doesn’t need to delegate authority. The more decentralized the organization is, themore authority is pushed down. The most damaging one may do as a manager is delegating responsibility without delegating authority. E.g. A regional manager tells store managers that they can’t make any decision in terms of changing product mix, but if the store underperforms with that specific product mix, then the manager blames it on