Keys to Management

3. Social needs: A human being needs to belong to a group, to be liked and loved, to feel accepted by others and to develop affiliations.

4. Esteem needs: After people have satisfied their social needs, they want to have self–respect and to be esteemed by others. They have a need for power, status, respect and self–confidence.

5. Self–actualization needs: These are the highest needs, ac

cording to Maslow. They are the desire to develop, to maximize potential and to achieve one's goals.

Maslow said that people satisfied their needs in a systematic way. When a need had been met, it stopped being a motivating factor. Research into Maslow's theory has not been very conclusive. Studies have tended to show that needs vary greatly among individuals.

Another theory of motivation, which has been very popular with managers, is Frederick Herzberg's 'two–factor' theory. Herzberg conducted a number of studies and concluded that at work there are certain factors which cause job satisfaction while others lead to dissatisfaction.

The group of factors bringing about satisfaction were called 'motivators'. They include things like a challenging job, responsibility, advancement, recognition, achievement, career prospects etc. These factors give rise to positive satisfaction.

Herzberg called the other group of factors 'hygiene' or 'maintenance' factors. These include company policy and administration, salary and fringe benefits, job security, quality of supervision, relationship with colleagues, job security, work conditions, status and personal life. These factors are considered to be only 'dissatisfiers', not motivators. If they do not exist, they cause dissatisfaction. If they do exist in quality and quantity, they do not, however, give increased satisfaction. Hygiene factors are essential if workers are to be motivated.

Hygiene factors refer to the context of the job – the conditions of work – while the motivators refer to job content.

If Herzberg's theory is true, it means that managers must pay great attention to job content (motivating factors). They must find ways of making jobs more challenging and interesting. The idea of such programmes is to give the worker a sense of achievement.

There are various methods of making work more interesting. These include job enlargement and job enrichment. With job enlargement, the worker is given additional tasks to perform. Job enrichment involves giving extra responsibilities to workers such as production planning, quality control and technical development of equipment.

9. Performance Appraisal

Most organizations have some form of performance appraisal of their employees. The appraisals are usually carried out once a year. The manager makes an evaluation of the performance of the subordinate. This involves filling out a form or writing a report on the person concerned. After this, there is a meeting at which the two parties discuss the appraisal. A performance appraisal is, then, a judgment on how well a person is doing his/her work.

Appraisals help organizations to reward staff properly. They are useful when decisions have to be made about salary increases and bonuses. They are needed when managers are considering transferring or promoting staff. In these situations, they provide up-to-date information about an individual's performance, skills and career objectives.

An important purpose of appraisals is to give the subordinate feedback on how he/she is performing. The manager can talk to the subordinate about the strengths and weaknesses of his/her performance. Не/She can also discuss how the subordinate can learn to work more effectively. At appraisal interviews, subordinates can not only talk about their future, but also seek guidance from the manager. The interview may help them to think more realistically about their goals.

There are many methods of evaluating a person's performance at work.

A traditional method has been to give a 'rating'. The subordinate's evaluation is based on traits — qualities - that he/she shows in his/her work. Subordinates are judged on such things as knowledge of the job, reliability, cooperation, punctuality, initiative and sense of responsibility. The manager rates the subordinate by marking a letter or figure on a scale.

However, the most popular form of appraisal, in Britain and the United States, is Management by Objectives. This appraisal is based on a person's performance, and how well he/she is achieving his/her goals. The manager and the subordinate agree on a certain number of objectives, which should be achieved in a given period of time. The focus is on results, not personality traits.

Another appraisal method is worth mentioning too. This is the Critical Incident Method. With this system, the manager keeps a record of good and unsatisfactory examples (incidents) of a person's work. These are kept in a file and reviewed with the manager when the interview takes place. An advantage of the system is that the manager has to think about the subordinate's performance throughout the year.

In spite of the need for performance appraisals, people do not like them. Many managers see appraisals as their most unpleasant duty and those who are appraised rarely have a good word to say for the system used by their organization. One problem is that the manager is expected to criticize the subordinate and to give guidance at the same time. Many people are naturally suspicious of appraisals. They think managers are trying to find out their weaknesses, so they are on the defensive. Moreover, managers are often unwilling to say that a subordinate's performance has been 'outstanding' or 'bad'. So, the individual is described as being 'just above average'. This means that high fliers in the organization do not get a good enough evaluation while the work of poor performers may be over-valued. Finally, many managers do not like to criticize, in writing, a subordinate with whom they are working closely, day-by-day.

Appraisal can be a valuable process. At the interview, the manager should act as a guide to the subordinate, not as a judge. The purpose of the interview should be to discuss how the individual can 'grow' in the organization, and make an effective contribution. The situation allows both parties to review the work of the individual and fix realistic targets.

10. Centralization & Decentralization

Alfred Sloan (1874-1966) was an outstanding figure in the business world of America. He worked for forty-five years in the General Motors Corporation (GM). Sloan published an account of his career with the organization. In it he described some of the managerial problems he had had, and how he had dealt with them.

According to Sloan, every large enterprise has to face one major problem. It must decide how much it wishes to centralize or decentralize its business. The terms refer to the degree of authority that is given to various levels of management and to the divisions of an organization. When we talk about centralized and decentralized businesses, we mean the extent / degree to which authority has been passed down – delegated – to lower levels or divisions of an organization.

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