CHAPTER SIX

Management History
NMMS 103
Contemporary Approach
Contemporary Approach

▪ The contemporary approach came to life

when managers started looking at how
the environment of the organization
impacted on how the organization was
managed.
▪ Most of earlier approaches to
management focused on manager’s
concerns inside the organization.
Contemporary Approach

▪ Two popular contemporary management

perspectives include the:
▪ Systems approach and
▪ Contingency approach.
 The Systems Theory
▪ The systems theory emerged in part after
theorists realised that scholars were trying to
explain the concept of management by looking
at the different individual components that
make up an organization.
▪ Rather than reducing an entity such as the
organization into its sub-parts or components
(e.g. employees, or management), systems
theory focused on the interrelationships
between these components and how they
should work together to achieve a successful
organization.
 The Systems Theory

▪ The way the parts are organized

and how they interact with each
other, determines the properties
& success of that system.
 Systems Approach
▪ The systems approach was partly proposed by
Chaster Bernard in his book The Functions of
an Executive.
▪ He defined a system as a set of interrelated
and interdependent parts arranged in a
manner that produces a unified whole.
▪ A system is an organized, unitary whole
composed of two or more inter-dependent
parts, components, or sub-systems working
together to achieve a specific objective (Kast
and Rosenzweig)
 Systems Approach

▪ The Systems Approach views organizations as

complex systems made up of interrelated
components which are:
▪ System Inputs [people, materials, technology, etc]
▪ System Processes [tasks, activities, etc]
▪ System Outputs [goods and services]
Types of Systems
 Systems Approach
▪ According to the systems theory, there are
two types of systems: Open system and
Closed system.
❑ Closed systems are those, which are
completely self-supporting and thus do not
interact with their environment.
❑ Open systems are those, which do interact
with their environment, on which they rely for
obtaining essential inputs and for discharge
of their system outputs.
 Systems Approach

▪ Organizations are normally viewed as

open systems because of their nature of
constantly interacting with their external
environment.
The Environment of the
Organization

Environment

Organization
Characteristics of Open
Systems
 Open Systems
▪ There three characteristics of an open
system, which are:
❑ They receive inputs or energy from their
environment.
❑ They convert these inputs into outputs.
❑ They discharge their outputs into their
environment.
 Open Systems
▪ A key component of open systems is their
interdependence on the environment,
which may be relatively stable or relatively
uncertain at a particular point and time.
▪ This feature is of considerable importance
to business enterprises which need to
adapt to the changing fortunes of the
market place if they are to flourish.
 Why is this approach
important to managers?
▪ Managers must view the organization as a system
made up of individual parts that must work together to
achieve a common objective.
▪ The individual parts can be:
❑ Organizational resources,
❑ Organizational culture
❑ Workers (employees)
❑ Departments,
❑ Management (managers)
❑ Organizational structure & Processes, etc.
▪ All these parts must always be working together
in-order to achieve the desired objectives.
▪ Also, a wrong decision in one section affects other
sections.
 Conclusion
▪ The systems approach discourages managers
from viewing organizations as being made up of
separate and disjointed components. (workers,
management, etc)
▪ Viewing an organization as a system promotes
synergy [1+1=3].
❑ Synergy means that if all the parts/ or
components of the system are working together
and with full cooperation, the output will be more
than the output by each unit working alone
separately (allsem1manfun1c.blogspot.com)
❑ Synergy- is when the working together of two or
more things produces an effect greater than the
sum of their individual efforts [internet source]
When there is no Synergy
in the Organization!!!!
Contingency Approach
 Contingency Approach
▪ This approach came to life after managers over
the years have realised that management
cannot be based on simplistic principles and
techniques to be applied in all situations.
▪ i.e. Different and changing situations/
scenarios called for different management
principles, approaches, and techniques.
▪ This approach says that organizations are
different, face different situations and therefore
require different ways of managing them.
 Contingency Approach
▪ In simple terms, the contingency theory
suggests that, what managers do in
practice depends on, or is contingent
upon, a given set of circumstances and/
or situation.
▪ The contingency theory states that,
there is no one best theory for all
situations, i.e. all theories are useful
and effective in particular situations, but
not in all situations.
 The Contingency
Approach

▪ The Contingency approach emphasizes

the need for managers to first diagnose
and understand a situation and then
identify the best management style or
theory most effective for the situation.
▪ The Contingency Approach is sometimes
called the Situational Approach.
 Features of contingency
approach:
❑ Management is externally situational: the
conditions of the situation will determine which
techniques and control system should be used to
fit the particular situation. i.e. Management is
entirely situational.
❑ There is no best way of doing anything.
❑ One needs to adapt himself to the circumstances.
❑ It is a kind of “if” “then” approach.
❑ Management policies and procedures should
respond to environment.
❑ Managers should understand that there is no best
way of managing. i.e. It dispels the universal
validity of principles.
 Assessment of the
Contingency theory
▪ Advantages
▪ It promotes flexibility when responding to different
situations.
▪ This means that, Globalization, and all its
challenges, can best be tackled through using the
contingency approach philosophy.

▪ Disadvantages
▪ The main disadvantage associated with this theory
is that, it promotes management to be more
reactive rather than proactive.
 Critics of the Theory

▪ However, the contingency approach is not

without its critics.
▪ Critics argue that the contingency theory
is really nothing new, but rather a meshing
up of theories from other approaches to
management.

▪ What do you think?

 Conclusion
▪ Management is a complex field of
study.
▪ Over the years different theories have
been put forward in an effort to
understand this concept.
▪ Each of the different theories of
management has contributed to the
overall understanding of management,
but it is important to note that each
viewpoint was a limited view of the
whole concept.
The End
THANK

YOU