Management Styles

Managing a group of people is a very difficult job. In ‘The Human Side of Enterprise’ Douglas McGregor outlined two opposing theories of work and motivation. What he calls Theory X is the traditional approach to workers and working which assumes that people are lazy and dislike work, and that they have to be both threatened (for example, with losing their job) and rewarded. It assumes that most people are incapable of taking responsibility and have to be looked after.

Theory Y, on the contrary, assumes that people have a psychological need to work and want achievement and responsibility. Many people assume that Theory Y is more ‘progressive’ than Theory X, but later theorists argued that it makes much greater demands on both workers and managers than McGregor realized. Abraham Maslow, for example, spent a year studying a Californian company that used Theory Y, and concluded that its demands for responsibility and achievement are excessive for many people. He pointed out that there are always weak and vulnerable people, with little self-discipline, who need protection against the burden of responsibility. Even strong and healthy people need the security of order and direction. Managers cannot simply substitute Theory Y for Theory X. They have to replace the security provided by Theory X with a different structure of security and certainty.

Thus, it is not easy to get people with different backgrounds, personalities, and experience to work well together. Managers approach the task of directing a group in different ways based on their management style.

Management Style is the way a manager treats and involves employees. Two very different styles often used by managers are tactical management and strategic management.

Tactical management is a style in which the manager is more directive and controlling. The manager will make the major decisions and stay in close contact with employees while they work to make sure the work is done well. A manager should use tactical management style when:

– working with part-time or temporary employees;

– working with employees who are not motivated;

– working under tight time pressure;

– assigning a new task for which employees are not experienced;

– employees prefer not to be involved in decision-making.

Strategic management is a style in which the manager is less directive and controlling and involves employees in decision-making. A manager using a strategic style will trust employees to work without direct supervision and will seek their advice on important decisions.

A manager should use strategic management style when:

– employees are skilled and experienced;

– the work is routine with few new challenges;

– employees are doing work they enjoy;

– the manager wants to improve group relationships;

– employees are willing to take responsibility for the results of their work.

In the past, many managers used the tactical style of management. They believed they were responsible for getting work done and thus needed to be directive and controlling. That often led to employee frustration because they felt their managers did not trust them. Some employees prefer that the manager make day-to-day decisions. Other employees are not experienced enough to work without close supervision. As a result, effective managers are prepared to use both styles. The combined use of tactical and strategic management is known as mixed management.

There is another classification of managerial styles which comprises autocratic, democratic and laissez-faire approaches.

An autocratic person has complete power and makes decisions without anyone else’s advice. Democratic style is based on the idea that everyone should have equal rights and should be involved in making important decisions. A laissez-faire styleis based on the idea that people should be allowed to make decisions themselves without interference from those in authority.

Effective managers must be able to influence the members of the organization. Influence enables a person to affect the actions of others. There are several kinds of influence a leader can use:

Position influence is the ability to get others to accomplish tasks because of the position the leader holds.

Reward influence results from the leader’s ability to give or withhold rewards. Rewards may be in the form of money or job benefits, such as recognition and praise.

Expert influence arises when group members recognize that the leader has special expertise in the area.

Identity influence stems from the personal trust and respect members have for the leader.

If a manager is not viewed as an expert and is not well liked, he or she will have to rely on position and reward influence. It is not easy to continue to get people to do things for you just because you are their manager. They will probably do just enough to get by, get a reward, or avoid punishment. Most leaders try to develop expert and identity influence.

Ex. 1. Read the text again and complete the following sentences, using your own words as much as possible.

1. According to Theory X, employers have to threaten workers because …

2. According to Theory Y, employers should give their workers responsibilities because …

3. Maslow criticized Theory Y because …

4. Management Styleis the way ….

5. Tactical management is used when ….

6. Strategic management is used when...

Ex. 2. Answer the following questions.

1. How is tactical management different from strategic management?

2. Which of the two management styles would you prefer if you were an employee? If you were a manager, which of the styles would you use? Do you believe everyone would answer those two questions the same way?

3. Peter Drucker says ‘Management is and has to be a power.’ What does this mean?

4. Do you share the opinion that “Poorly considered solution will be costly in dollars, happiness, or both? ”

Ex. 3. Put the terms laissez-faire, democratic and autocratic into the correct place in the table. Explain your choice.

Ex. 4. Give the short summary of the text. Use the following cliché s:

McGregor outlines two opposing theories …; the approach assumes that …; he concluded that …; he pointed out that …; thus …; they believe that …; etc.

Ex. 5. As you read the passage, highlight Sam Walton’s managerial decisions that ensured the success of Wal-Mart.

Wal-Mart, an American retailer was founded 40 years ago by Sam Walton. He opened his first Wal-Mart store, in Rogers, Arkansas on 2 July 1962. He was 44 at that time.

Initially, Sam Walton set up traditional retail outlets with relatively high prices. But then on he sought to drive out unnecessary costs wherever he could, all with the aim of bringing prices down.

Since Walton was operating on small profit margins he appreciated the need for growth. ‘If you are not going to make much on each item you had better sell a lot of them’. Walton would fly around America literally looking at the land below. When he saw a piece of property that was fairly near to a few small towns he would land the plane, buy the property and order a new Wal-Mart to be built.

Compared to most city centre supermarkets Wal-Mart stores are enormous and offer an extremely wide range of goods: everything from food to mobile phones, CDs, prams, paint, cameras, tools, bikes and so on. Wal-Mart stores have now become something of a national institution in America.

Sam Walton not only brought about the dominance of low-price stores in America, he also appreciated the importance of information technology very early. In the late 1960s he visited IBM to find the best person he could, hired him and got him to computerize Wal-Mart’s operations. Nowadays Wal-Mart’s computer database is second only to the Pentagon’s in capacity.

In the 30 years before his death in 1992 Walton built an empire that turned him into the wealthiest man in America and led the way in retailing worldwide. There are now over 1, 700 Wal-Mart stores in the USA. Wal-Mart also has over 1, 000 stores outside America. Its profits last year were an astonishing $6bn and the company’s market value was over $260bn. Wal-Mart became the biggest company in the world in terms of sales.

Text 3

Read the text and do the tasks that follow.