Performance management theory

1. Performance management theory
The work of management theorists over the last hundred and fifty years can be used to
argue the case for an in depth theoretical, as well as practical knowledge of many
management styles, including the positive and negative attributes of each. It is also
important to examine the 'structure' of different organisations to consider how it affects,
and is affected by the management style of that organisation. Organisational Structure is
essentially concerned with the allocation of authority and power. Managers need to make
decisions and need to have the authority to do so. A 'hierarchical organisation' will have
the greatest power at the top of the organisation, and the command structure will be in a
downward direction. In a 'flat organisation' power is distributed more evenly, but there
will still be major differences in the level of power and authority between different
members of the company. Some organisations such as the armed forces or police have
many tiers (or levels) and are tall in their hierarchy. Universities, however would have
few levels between those at the bottom and those at the top and would be considered a
'flat hierarchy.' The 'span of control' (number of people an individual manages or
supervises directly) is closely linked to the type of organisational hierarchy that exists.
Many of the new 'buzzwords' and 'flavour of the month theories' that Mr. Whitehead
mentions are no more than a current evaluation of the theories of yesteryear. The re-
visiting of these theories will provide conclusive evidence that management theory is
central to the modern manager's education.
The Work of Frederick Winslow Taylor (1856-1915)
Frederick Taylor, whilst working as a gang boss in a lathe department in Midvale, USA
became determined to eradicate 'systematic soldiering'; an attempt by workers to do no
more than was necessary. Taylor developed a strategy where particular jobs were studied,
then broken down into individual tasks, which had to be completed exactly as stated.
Each task was allocated a time, based on the timed work of the quickest worker. Workers
were then allocated specific tasks, and were not allowed to deviate from that task at all.
As Taylor believed that money was the main motivator, a payment was made for each
completed unit of output (piece rate)
Many organisations and work methods are still influenced by Taylor's concept of
'Scientific Management Methods' This can be seen on factory assembly lines, and even in
the commercial kitchen, where each member of staff is allocated a small but specific task
in making up a completed gourmet meal. Piece rates may not be prevalent, but the
allocation of boring, repetitive tasks is common. An article in The Sunday Times, 3rd
April 1983 tells of one worker's plight, assembling the Maestro car at the Cowley Plant.
He had just one hundred seconds to screw on two rubber buffers and fit three small plates
to the rear wheel arch. He had been given one night's training, completed his task on
exactly 246 vehicles per day, and had 46 minutes per shift of 'relaxation time'.

2. Some of Taylor's early followers achieved spectacular results in increasing output.
However, the stringent and oppressive tactics that were employed often led to industrial
unrest. After 'Scientific Management Methods' were employed at the Watertown Arsenal,
immediate strikes ensued. The American Congress eventually banned Taylor's time and
motion studies in its defense industry.
The use of such methods in the modern workplace can produce useful results in the short
term, but for longer-term rewards they must be balanced against the effects on workforce
morale. To assume that everybody can work at the same rate as the fastest worker, and
that money is the only real motivator may not be borne out. Today's workers want to be
empowered, and to take an active role in their organisations, not be treated like machines
where only the end product is important.
Henry Laurence Gantt
Henry Gantt worked for Taylor at the Bethlehem Steel Works. His ideas were broadly
supportive of Taylor's ideas, but he added a more humanizing approach. He believed that
scientific management was used in an oppressive way by the unscrupulous. Gantt moved
away from the strict piece rate system of pay, instead offering a set wage plus 20% - 50%
bonuses. If workers achieved the set objectives within the day a bonus would be paid.
Supervisors were introduced who also received bonuses if targets were met by his team.
Gantt's less oppressive regime can be seen today in many organisations. In factories
around the globe workers receive bonuses for achieving daily, weekly or monthly targets.
The Work of Henri Fayol (1841-1925)
Henri Fayol, the 'Father of Modern Management Theory' was interested in how
management worked, and could be applied on a universal basis. His theories focused on
Rules, Roles and Procedures.
Fayol's 'Five Elements of Management' are:
* Planning Setting objectives, and strategies, policies and procedures to achieve them.
* Organising Setting tasks to achieve the objectives. Allocating the tasks to groups or
individuals, and empowering those responsible for that task.
* Commanding Instructing those carrying out the given task.
* Coordinating Ensuring a common approach by groups to meet the objectives of the
organisation.
* Controlling Ensuring the performance of individuals and groups fits with the plans, and
correcting as necessary.

3. Fayol's theories are as relevant today as they ever were, and most, if not all managers use
his 'elements of management'.
The Work of Peter Drucker
Drucker's work in the 1950's followed on from that of Fayol. He had five categories of
'Management Operations'
* Setting Objectives Senior Managers organise objectives into targets. This is cascaded
down to more Junior Managers.
* Organising The workload is divided into manageable activities and jobs.
* Motivating This involves communicating and creating the right conditions for targets to
be achieved.
* Measurement Comparing performance against targets.
* Development Enabling people to use their talents.
Fayol and Drucker had very different views on the role of workers within their theories.
Fayol's work has a distinct leaning towards worker's having to be told what to do, their
work checked and corrected, with managers delegating tasks and overseeing from a high
level (a Tall Hierarchy?). Conversely, Drucker's ethos is about the empowerment of
workers, giving them the opportunity to utilise their talents, with managers occupying a
role that is more about assisting and coaching workers.
Fayol's ideas fail to take into account the people within the workplace, whereas Drucker
takes a somewhat more humanist approach.
Elton Mayo - The Human Relations Approach
By the 1930's there was evidence emerging that production could be raised by applying
motivational methods within a workforce. These ideas were very different to the
techniques of F.W Taylor and, although concerned with profit, the 'human relations
approach' to management was also concerned with social relations in the organisation.
The approach assumed that workers were genuinely committed to their companies and
that they had a desire to work towards achieving its goals.
Elton Mayo had carried out experiments at the Hawthorne Plant, and these sought to find
ways to improve production by changing workers conditions and pay structures. Mayo
worsened conditions for workers, then returning them to how they were. The rise in
output was due to workers communicating more and working as a tighter team unit. It
was also found that the effect of taking an interest in workers made them feel important
and that their opinions were valued.

4. Volvo and Honda have seen the development of work team in recent years, with the
differences between workers and managers being far from obvious. People wear the same
uniforms, and the emphasis on communication is high. Developing cohesive teams who
work well together and share the same goals ensures a high level of motivation for the
tasks required. The structure of this type of organisation could be considered a 'flat
hierarchy' with a wide span of control for managers working over a skilled and competent
workforce. Subordinates are well trained and a good level of trust between managers and
workers exists.
The 'Human Relations Approach' is definitely a positive way of management for the 21st
Century, where personal empowerment and self-esteem should not be in question.
Mr Whitehead's view that "Haven't generations of managers done perfectly well by
learning on the job and applying a bit of common sense" cannot accurately be quantified.
Within the Fire Service, promotion to managerial roles is based on internal qualifications
and interview alone. Virtually all managers have based their management style on exactly
what Mr. Whitehead advises in his letter. Some are very good and are respected as such;
however there are a large number who cannot manage people or their responsibilities
within the organisation. Respect for leadership within the fire service is essential, but
often rare in modern times. Managers who had an in depth knowledge of management
strategy may well motivate the workforce to new heights. This type of 'tall hierarchical'
organisation has many tiers of command with spans of control for senior managers being
relatively small, with the widest spans of control being at junior management level.
"An endless supply of new gurus spin off new batches of buzzwords which help
successive generations of whiz kids to get promoted on the basis of slogans" is not an
accurate depiction of the modern manager. It's certainly true that there are managers who,
even with the background of a management related education are ineffectual in their
roles. This is not a reflection on management theory. Studies of management styles allow
one to make informed decisions, and to have an array of options at your disposal, and to
adapt to the ever-changing pressures on the organisation, both internal and external.
"Meanwhile real managers just do what they have always done, maintaining discipline
and telling people what to do" The idea of a 'one style fits all' manager is unrealistic, and
one that has a proven track record of leading to unrest. Even within one organisation the
manager or managers need to be flexible within their roles. Leadership is vital, but a
leader who is flexible, approachable, and has the interest and aspirations of both workers
and organisation at the forefront of their strategy will flourish. Conversely, the manager
who's only interest is the level of output and profit will not be supported by those
producing that output. Respect is most certainly a two-way avenue.
My review of the theories of 'management gurus' of the past is designed to show that
these ideas are not new. One can look at any organisation and see many of these ideas
working in parallel. As far as organisational structure is concerned, one cannot make
stereotypical assumptions based purely on the size of the organisation or the number of
employees. The style of management and the systems of work employed all help to

5. define the structure. Most organisations employ many of the characteristics discussed
above, in different ways, and at different times dependent on the dynamics of the
situation. Most businesses are constantly evolving and redefining themselves to meet the
requirements of the modern marketplace. There is no correct answer, or one style which
is superior to others. Each has its positive and negative points, but without fundamental
knowledge of them all, how can one possibly manage effectively?
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