Part III – “People are our greatest Asset” – Human Capital Management

Part III – “People are our greatest Asset” – Human Capital Management

“People are our greatest Asset” – Human Capital Management

 Continuation from last week.

The development of the Management Theory- How relevant in today’s context

  • In my previous article I explained the scientific management theory written by Fredric Winster Taylor (1856-1915). This was followed by Administrative management Theory also known as Principles of Management by Henry Fayol (1841- 1925), Bureaucracy by Max Weber (1864- 1920), Holistic approach to management by Mary Parker Follett- (1863- 1933) and Organization Theory by Chester Bernard- (1886-1961) along with many others in the Neo Classical School of management.

       

Fredric .W. Taylor Henry Fayol Max Weber Mary .P. Follett Chester Bernard
(1856-1915) (1841- 1925) (1864- 1920) (1863- 1933) (1886-1961)
Scientific Management Theory Administrative Management Theory Bureaucracy Holistic Approach to management Organization Theory
Standardization, Time & Motion study 14 Principles of Management 3 types of authority Principles of Coordination (4+4) Formal vs Informal teams

 Fayol identified the role of the manager include forecasting and budgeting, planning and following a path of action, organizing and building up the structure and resources of an organization, commanding and maintaining activity ,coordinating , bringing together and controlling  and ensuring all confirms. He also defined 14 principles of management that will maximize efficiency of the organization. The 14 principles he identified were Division of work, Authority, Discipline, Unity of Command, Unity of Direction, Subordination, Centralization , Remuneration,  Scalar chain, Structure, equity , security , initiative and esprit de corp ie harmony.

In today’s context almost all these principles are adhered in organizations from the West and the East and in Sri Lanka. Although we speak of no one way of managing an organization in an volatile economy as of today , most organization still follow the principles of management in the same context either in the private sector large organizations or small entrepreneurs and public sector organizations . Only consideration is that the Universal Principles of Management will only work if it can adapt to the culture of a particular country , region or organization.

The performance Evaluation system and the importance of understanding that the management is separate from the Ownership are two other important outcomes that are even practiced in many organizations today.

Why is then people are not treated as Capital ?

Weber on the other hand focused on the authority i.e. why people in organizations obey orders. He categorized this into three areas. Namely Charismatic authority (Personality), traditional authority (precedent) and legal authority (rules and procedures). The authority is assigned to the position and not the person, while work is allocated as per hierarchy of positions with defined areas of competencies. While a formal structure ensures uniformity of decisions and high task specialization. Promotions are based on seniority and merit and rewards for effort is regular.

While the bureaucracy is still practiced in many growing organizations where it helps to communicate effectively across different sections, units, departments effectively the process take a larger time when dealing with customers. Although Customer Service is very important in today’s fast changing business environment i.e. Era of ‘Customer is the King “. Employees tend to follow the  red tape procedures and rules to service the customer at their own connivance i.e. “ Employee is the King “. This has actually resulted in many organizations i.e. Public sector in particular where rule, procedures, administrative guidelines governs a person deviating from the established system.

If so why don’t we recognize this and value our human resources?

Parker focused on the importance of coordination across all sections of an organization. The importance of coordination at the yearly stage of planning and continuously follow the process is important, She also highlighted the importance of having direct contacts with the subordinates and reciprocal decision making. The importance of effective communication, importance of mutual respect and trust with each other , all have clarity on their job roles and objectives and following the scalar of chain in an organization was also important

Today’s most organizations have understood the importance of coordination across all functions and departments but the basic principles  of Parker  are not followed. I have come across many CEOs and heads of functions talk openly saying “ 80% of organizations problems are due to poor communication or miscommunication followed by not trusting the fellow employees with regard to sharing of information “. Organizations that do coordination well have shown better results. After all coordination is a people activity.

Do we recognize this when we value our organization people?

Bernard spoke of organization theories which focus on informal organization that exist within the formal set up. In most instances the informal organization i.e. we call it the clique are very powerful with regard to shaping peoples behaviors’ and   attitudes. This has given rise to the importance of team work in an organization.

Today the informal teams in organizations have a bigger role to play towards organization success. It is up to the leadership to understand these teams’ requirements and shape it to suit the organizational requirements.

This theory also identifies the importance of people power in an organization where formal power does not exist. Have we value this in our organizations?

Lets focus on the Behavioral Approach to management in our next issue……

About the writer

Mahesh Jayasinghe

(PhD research student, Management Consultant, Executive Coach, Corporate trainer, lecturer and Company Director, Forward your comments to maheshvipulaj@gmail.com )

Comments (93)

  1. I am only writing to make you know of the perfect experience my daughter experienced using your site. She came to find numerous issues, most notably what it is like to have a great giving mindset to let other folks very easily fully understand various very confusing topics. You undoubtedly surpassed visitors’ desires. Many thanks for churning out those beneficial, safe, informative and as well as fun tips about the topic to Jane.

  2. My wife and i have been really glad when John could complete his investigations from the ideas he acquired from your own web page. It is now and again perplexing to just choose to be giving freely solutions which many others have been trying to sell. And now we already know we now have the website owner to give thanks to for this. Most of the illustrations you have made, the easy blog navigation, the friendships you will help to promote – it’s most fantastic, and it is letting our son and our family imagine that the article is awesome, and that is really fundamental. Many thanks for everything!

  3. I have to express my appreciation to this writer for bailing me out of this type of condition. After researching through the the web and getting notions which are not powerful, I believed my life was gone. Living devoid of the strategies to the difficulties you’ve sorted out as a result of your main report is a crucial case, as well as those which may have badly affected my entire career if I had not discovered your web blog. That capability and kindness in maneuvering every item was useful. I don’t know what I would’ve done if I hadn’t discovered such a solution like this. I can at this moment look ahead to my future. Thanks a lot very much for this skilled and effective help. I won’t be reluctant to propose your web blog to anybody who requires guidelines about this subject matter.

  4. I would like to express my appreciation to the writer just for rescuing me from this particular difficulty. Because of checking through the online world and finding proposals which are not helpful, I was thinking my life was done. Existing minus the approaches to the difficulties you have fixed by way of your entire blog post is a critical case, as well as the kind which could have in a negative way affected my career if I had not encountered your web site. Your good know-how and kindness in maneuvering a lot of things was valuable. I’m not sure what I would have done if I hadn’t come upon such a solution like this. It’s possible to at this time relish my future. Thank you so much for your skilled and sensible guide. I will not think twice to suggest your web site to anyone who needs assistance about this subject.

  5. I would like to show some appreciation to this writer just for bailing me out of this situation. After surfing around through the the web and obtaining principles that were not powerful, I thought my life was gone. Being alive minus the strategies to the issues you have resolved all through the short article is a crucial case, as well as those that would have in a negative way affected my career if I hadn’t discovered your web site. Your personal capability and kindness in playing with almost everything was useful. I’m not sure what I would’ve done if I hadn’t come upon such a stuff like this. I can also now look forward to my future. Thanks a lot so much for the specialized and amazing help. I won’t hesitate to propose your web page to any person who needs to have guidance about this subject matter.

  6. I simply needed to say thanks yet again. I’m not certain the things I might have undertaken in the absence of the actual ways documented by you concerning that area. Certainly was an absolute intimidating issue in my view, however , considering the specialized avenue you handled the issue made me to cry over contentment. I’m just happy for this information and then trust you recognize what a powerful job you have been carrying out instructing the rest via your web page. I know that you’ve never encountered all of us.

  7. I must get across my love for your generosity for folks who require help with this matter. Your very own dedication to getting the message all around came to be definitely beneficial and has truly made others just like me to reach their dreams. Your helpful publication can mean much to me and further more to my office workers. Best wishes; from all of us.

  8. My wife and i ended up being quite fortunate Edward managed to carry out his investigations out of the precious recommendations he discovered when using the blog. It is now and again perplexing to simply possibly be giving out steps which usually many others have been making money from. So we grasp we need the blog owner to be grateful to for that. The explanations you have made, the straightforward blog menu, the friendships you can assist to instill – it’s got many remarkable, and it’s facilitating our son in addition to the family recognize that that concept is fun, and that is particularly fundamental. Thank you for the whole thing!

  9. I want to express my affection for your kindness supporting people who need help on in this field. Your real dedication to passing the message throughout turned out to be amazingly informative and has really helped professionals much like me to arrive at their desired goals. Your own interesting help and advice entails a whole lot to me and even more to my fellow workers. Many thanks; from each one of us.

  10. I simply had to appreciate you all over again. I do not know the things I would have followed in the absence of these smart ideas documented by you regarding such a situation. It actually was a hard scenario in my circumstances, nevertheless coming across a well-written fashion you processed that forced me to weep over delight. I am just grateful for your help as well as hope that you realize what an amazing job you are getting into training the others by way of your website. Most likely you haven’t encountered any of us.

  11. I precisely needed to thank you very much once again. I’m not certain what I might have taken care of in the absence of those tactics shared by you over such a theme. This has been a very fearsome condition in my opinion, however , noticing this well-written strategy you processed it took me to weep for joy. Extremely happier for this information and hope that you are aware of an amazing job you’re accomplishing training men and women by way of your web page. More than likely you have never come across any of us.

  12. I and also my buddies came taking note of the excellent tips from your web blog and so before long got an awful suspicion I had not expressed respect to the website owner for those tips. My people appeared to be for this reason happy to read them and now have in truth been loving these things. Many thanks for being very kind and then for choosing this kind of wonderful ideas millions of individuals are really wanting to know about. My very own honest regret for not saying thanks to earlier.

  13. I have to point out my appreciation for your generosity giving support to persons that really want help on your theme. Your special commitment to getting the solution all over turned out to be astonishingly good and have all the time allowed individuals much like me to arrive at their pursuits. Your amazing invaluable report indicates a whole lot a person like me and substantially more to my peers. Regards; from everyone of us.

  14. I wanted to put you the tiny word just to thank you very much yet again with your pleasing suggestions you have discussed in this article. This is really wonderfully generous of you giving easily what a number of us could possibly have offered as an e-book to make some cash on their own, notably seeing that you might well have done it if you desired. Those guidelines as well served to be the great way to be sure that someone else have a similar interest just as my own to see good deal more with regards to this matter. I think there are a lot more fun opportunities in the future for people who find out your blog post.

  15. I must express appreciation to the writer just for rescuing me from such a situation. Because of exploring throughout the the net and obtaining tricks that were not helpful, I believed my entire life was done. Existing devoid of the strategies to the problems you’ve solved by way of your entire guide is a serious case, as well as the kind that might have adversely affected my entire career if I had not noticed your blog. Your own personal capability and kindness in taking care of all the stuff was very helpful. I am not sure what I would’ve done if I hadn’t discovered such a thing like this. It’s possible to at this moment look forward to my future. Thanks a lot very much for the specialized and results-oriented help. I will not think twice to suggest your blog post to anyone who should receive assistance on this problem.

  16. I precisely had to thank you so much again. I’m not certain what I would’ve handled in the absence of these methods shown by you about such area of interest. Completely was a real scary scenario in my view, but finding out your specialized mode you resolved the issue forced me to cry with happiness. I am happy for your work and even sincerely hope you find out what a great job you have been carrying out training most people via a site. Most probably you haven’t got to know any of us.

Post a Comment