The Theory of Organization

THE THEORY OF ORGANIZATION

A team of research anthropologists once described a large, complex business composed of twenty-four divisions evenly distributed through the United States and linked together by a nine member central governing body. Members of this business are drawn primarily from one ethnic group. Each of the twenty-four divisions has a hierarchical structure of positions and roles that regulates the power in total business.

We present an overview of three schools of thought on the term organization. Our specific objectives are these :

1. To define and illustrate the term organization
2. To describe, illustrate, and list the key concepts of the following schools of thought on business organizations :
1. classical school
2. human relations school
3. social systems school
3. To list the key questions that each of the three schools asks about organizations
4. To discuss the important theorists and their contributions to each school of thought
5. To examine the communication implications in the three schools of thought

Overview and Definition

Three ways of examining organizational relationships represent the essence of the three major schools of organizational thought and theory.

The classical theory of organization asks such questions as the following : How is the work devided? How is the labour force devided? How many levels of authority and control are there? How many people are there at each level? What are the specific job functions of each person?

The human relations school of thought studies work groups of people and asks such questions as the following : What roles do people assume in organization? What status relationships result from the various roles? What are the morale and attitudes of the people? What social and psychological needs do the people have? What informal groups are there within the organization?

The third school of thought is concerned with social systems and emphasizes the relationship of the parts to the whole organization. Questions comm0only asked by this approach are these. What are the key parts of the organization? How do they relate interdependently to each other? What are the main goals of the organization? What is the relationship between the organization and its environment?

The Classical School

The classical theory of organization is concerned almost entirely with the design and structure of organizations, not with people. The scientific management movement in which man was described as a rational, economic being who can best be motivated to work by such carrot and stick techniques as piecework systems, bonus systems, time and motion studies, and cost figuring systems.

A large clothing manufacturer in the Southwest requires each employee to produce a certain amount of work each day. All employees, supervisors, and visitors can observe an individuals production efforts by simply examining the graph.

The classical theory of organizing workers developed to meet the needs of scientific managers. Two foremost scholars of the classical school were Henri Fayol and Max Weber. Others were James Mooney and Alan Reiley, Luther Gulick, and Lyndall Urwick, and Chester Barnard.

Among the recommended principles of management, Fayol included the following :

1. Division of work ( specialization )

2. Authority and responsibility ( power )

3. Discipline ( obedience )

4. Unity of command ( one boss )

5. Unity of direction ( one plan )

6. Subordination of individual interest to general interest ( concern for the organization first )

7. Remuneration of personnel ( fair pay )

8. Centralization ( consolidation )

9. Scalar chain ( chain of command )

10. Order ( everyone has a unique position )

11. Equity ( firm but fair )

12. Stability of tenure of personnel ( low turnover )

13. Initiative ( thinking out a plan )

14. Esprit de corps ( high morale )

Division of labor refers to how a given amount of work is divided among the available human resources. The division can be according to nature of the various jobs or according to the amount of responsibility and authority each person assumes. The first is a functional division of labor, the second is scalar.

Scalar and functional processes express, respectively, the vertical and the horizontal growth and structure of the organization. Scalar refers to the levels of the hierarchy ( the chain of command ) in the organization. Functional refers to the specific job duties of each employee in the organization.