SHS

Organization and
Management

Quarter 1 – Module 8
Organization Theories for Effective
Business Management

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Organization and Management – SHS

Quarter 2 – Module 8: Organization Theories for Effective Business

Management

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Regional Director: Gilbert T. Sadsad

Assistant Regional Director: Jessie L. Amin

Development Team of the Module

Writer: Glenda C. Bas

Editors: Elsa B. Regalado
Meriam L. Camila, PHNHS Principal
Jinky A. Villareal, EPS Iriga City
Reviewers: Jinky A. Villareal, EPS Iriga City
Loyd H. Botor, EPS RO V
Illustrator: Ryan B. Cerillo
Layout Artist: Glenda C. Bas
Cover Art: Jed Adra

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 Lesson ORGANIZATION THEORIES FOR EFFECTIVE
BUSINESS MANAGEMENT

Hi, good day learner! Previously you

had able to learn the nature and type of organization.
Today, you will understand theories that support it.
Because even nowadays, company applies theories
suitable in their organizational needs. This module
discusses and explains the different organizational
theories that can help companies to achieve their
organizational goals.

As you go through the module, you will

be able to:

discuss common and classical theories as

foundation of organization; and
describe how these theories affected and
developed today’s organizational trends.

Don’t forget to be familiar with the words below; it will help you a lot…

Theory – it is an idea or set of ideas that is intended to explain facts or

events.

Functionalization – specialization of skills of individual in the organization.

Unity of command – it is the unified command at the top of the

organization.

Narrow span of control – the number of subordinates an individual can

supervise.

One-way authority – authority flows down the line of command from the top
management down to the bottom of the organization.

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 How far do you know?
Let see how far you know by
simply performing the test below.

Direction: Read the statement carefully of what its stand for. Choose and underline
your answer from the given option.

1. (Scientific Management Theory, Theory of Bureaucracy) Officials are selected

on the basis of competence and on irrelevant considerations.

2. The authority that flow down to line of command from top to the bottom of the
organization is called (One-way authority, Unity of command)

3. According to (Frederick Taylor, Robert Golembiewski) moral sensitivity can be

associated with satisfactory output and employee’s satisfaction.

4. (Scientific Management Theory, Social Ethics Theory) this is also known as

machine model where it follows procedural mandates in the organization.

5. It is a limit to the number of immediate subordinates that any one individual can
effectively supervise is (Division of Labor, Narrow span of control)

Let’s get
started learner by
performing the
Let see if you know…..
Activity #1 – TRUE OR FALSE

Direction: Read the statement carefully. Write TRUE if the statement is correct and
FALSE if you do not agree.

______ 1.) Narrow span of control pertains to the maximum workload to be perform
by the worker.

______ 2.) In the theory of bureaucracy, the hierarchical arrangement offices are
not observed.

_______ 3.) According to a theorist work must allow the social being to develop his
faculties.
_______ 4.) There must be a unified command from the top of the organization.

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_______ 5.) There will be a maximum productivity when good working environment
and human relationship exist in the organization.

Had you able to answer them all

correctly? If not, it’s okay. You will
understand them all as you go through
the module.

What do I need
to know?
In most organizations, various forms may be
adopted to achieve the organizational goals effectively
with the least cost. For instance, a firm may adopt not
only one but several theories on organization, may discard
some principles of one theory but adopt what it finds
suitable for the purpose.

Scientific
Management
Theory

Theory of Social Ethics

Bureaucracy Theory

ORGANIZATIONAL
THEORY

For purpose of comparison, some organization theories with their unique

characteristics, usefulness, and perhaps, limitations, will be examined. They are
classical theories of organization which gave the strong foundation of the evolution of
organization. They are the following:

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 Read to understand…
Scientific Management Theory

This theory is propounded and discovered by Frederick W. Taylor also

known as machine model or scientific management theory of an organization.
This model bears the following peculiars:

1. Division of Labor and Specialization. The functions of the

organization are differentiated and placed in separate departments.

2. Unity of command and centralization of decision making. For

various parts of the organization to function correctly, there must be
unified command at the top of the organization.

3. One-way authority. Authority flows down the line of command, from

the top to the bottom of the organization.

4. Narrow span of control. There is a limit to the number of immediate

subordinates that any individual can effectively supervise.

Also Taylor suggested functionalization as a system or organization. These

techniques would make maximum use of the specialization skills of individuals in the
organization. He applied the concept of functionalization to foremen. Since it
violated the unity of command doctrine, functional foremanship never was widely
accepted. However, this concept became at a later time the foundation for the idea
of functional staff authority which is most important element in the organization
theory.

Theory of Bureaucracy

Another theory in organization is the Bureaucratic model by Max

Weber. This model clearly resembles bureaucratic type. The following is its
characteristics:

1. Division of labor with specified spheres of competencies legitimized

as official duties;

2. Hierarchical arrangements of offices, that is, each lower office is

below a higher one;

3. Rules for carrying out the work to be applied uniformity to

individual cases;

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4. Impersonality where the official is subject to an impersonal order and
established as norms of conduct and acts objectively in relating with
individuals inside and outside organization; and

5. Officials are selected on the basis of competence and on irrelevant

considerations.

Social Ethics Theory

The social ethics theory responds to a society that is becoming

increasingly characterized by interdependence. This model suggests that
moral sensitivity can be associated with satisfactory output and employee’s
satisfaction (Golembiewski, 1965). In other words, the quality of human
relations defines their behavior in the organization.

According to Robert Golembiewski, the job, work flows, and

organizational structure can be modified according to the work environment
– quality of human relations. The characteristics are as follows:

1. Work must be psychologically stale to individual;

2. Work must allow the social being to develop his faculties.

3. Work task must allow the individual considerable room for self-
determination.

4. The worker must have the possibility of controlling, in a meaningful

way, the environment within which task is to be performed; and

5. The organization should not be sole and final arbiter of behavior.

Both parties must be subjected to an external moral order.

Can you now distinguish their

differences?
Now let see what you
have learned…

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 Try this...have
fun!
Practice Task 1

Direction: Complete the following incomplete words by taking the clues from the
statements below.

a.) T_EO_Y _F B_RE_U_RA_ _

b.) NA_ _OW S_AN OF C_N_R_L

c.) _N_T_ O_ C_M_A_D

d.) M_X W_B_R

e.) S_CI_L E_HI_S TH_OR_

Clues:

a.) Officials are selected on the basis of competence and on irrelevant

considerations.

b.) There is a limit to the number of immediate subordinate that anyone can
effectively supervise.

c.) There must be a unified command at the top of the organization.

d.) Discovered and propounded the theory of bureaucracy.

e.) This theory state that work must be psychologically stale to individual.

You’re doing great,

but there’s some more!
Now, try the next

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Practice Task 2

Direction: Read the statements carefully and identify what theory or who the
theorist is. Write your answer in the spaces provided for.

Frederick Taylor Theory of Bureaucracy Robert Golembiewski

Social Ethics Theory Max Weber Scientific Management Theory

___________________ 1.) He discovered the machine models or the scientific

methods theory.

___________________ 2.) This theory model clearly resembles the

bureaucratic type.

___________________ 3.) This models suggests that maximum productivity of

employee or worker comes from being satisfied in the
organization.

____________________ 4.) According to him, jobs, work flow and structure can be
modified according to the work environment and quality
of human relations.

____________________ 5.) A theory that makes use of specialization skills of

individuals in the organization whereby
functionalization is applied

Good job!
You are now about to
complete the module by answering
the final test prepared for you.
Good luck learner!

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Post Test:

Direction: Read the following and write the letter that corresponds to the correct
answer.

1. A theorist who said that “moral sensitivity can be associated with satisfactory
output and employee’s satisfaction”.
A. Max Weber C. Abraham Maslow
B. Robert Golembiewski D. Fredrick Taylor

2. This is also known as machine model where it follows procedural mandates in the
organization.
A. Theory of Bureaucracy C. System Theory
B. Social Ethics Theory D. Scientific Management Theory

3. In this theory, officials are selected on the basis of competence and on irrelevant
considerations.
A. Theory of Bureaucracy C. Scientific Management Theory
B. System Theory D. Social Ethics Theory

4. There is a limit to the number of immediate subordinates that an individual can

effectively supervise.
A. Division of Labor C. Narrow span of control
B. One-way authority D. Unity of Command

5. The authority that flows down to line of command from top to the bottom of the
organization.
A. Unity of command C. Narrow span of control
B. One-way Authority D. Division of Labor

6. Principles of division of labor and specialization was propounded by _______.

A. Frederick Taylor C. Robert Golembiewski
B. Max Weber D. Abraham Maslow

7. A theory that supports the development of the social being of the employees.
A. System Theory C. Social Ethics Theory
B. Theory of Bureaucracy D. Scientific Management Theory

Additional Task:
Enumerate ways by which employees and employers will be
benefited with these organizational theories nowadays.

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How far do you know (Pretest):

1. Theory of Bureaucracy 4. Scientific Management Theory

2. One-way authority 5. Narrow span of control
3. Robert Golembiewski

Learning Activity 1
1. FALSE 4. TRUE
2. FALSE 5. TRUE
3. TRUE

Practice Task 1

a.) THEORY OF BUREAUCRACY

b.) NARROW SPAN OF CONTROL
c.) UNITY OF COMMAND
d.) MAX WEBER
e.) SOCIAL ETHICS THEORY

Practice Task 2

1. Frederick Taylor 4. Robert Golembiewski

2. Theory of Bureaucracy 5. Scientific Management Theory
3. Social Ethics Theory

Post Test
1. B 5. B
2. C 6. A
3. A 7. C
4. C

Reference:

Samar, Gregorio L. et al. (2016) Introduction to Organization and Management. Hunt

Publishing Center.85-87.

Thank you
learner, you did
great! Stay safe.

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