RATIONAL MANAGEMENT THEORY IN A CONTEMPORARY BUSINESS ENVIRONMENT

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1. Introduction

Management theories are important to business leaders and managers by providing them with the correct, applicable tools to achieve the desired goals such as improved profitability, and performance, higher customer loyalty and brand awareness, and a strong, committed workforce with sufficient qualifications. In most contemporary businesses, the goals of staying profitable and attracting new customers as well as retaining current ones are most critical, and the way to achieve these is often through the business’ most important assets, the human resources. A talented and committed workforce can hugely impact the business’ outcomes, and make a significant difference in the long-term performance. As such, the correct management mindset is critical in helping a contemporary business achieve its goals and purposes (Dean, 1994).

A widely popular and long-established model of management is the rational management approach. Rational management systems take the scientific approach to solving business problems (hence also referred to as the scientific management systems). These systems frequently use mathematical and analytical tools to measure and analyze complicated sets of business information before making a decision. In recent years, given the dynamic changes in business environment, the rational approach has been insufficient to account for the new conditions in certain cases. Other alternative ways of management such as the chaos (or complexity) theory, extraordinary management, high commitment theory, bureaucratic management, human relations movement, contingency theory, systems theory, theory X and theory Y, etc. to better account for the surrounding uncertainty (Quinn, 1988).

This paper will evaluate the rational approach to management and the relevance and extent to which it is applied in contemporary businesses. In addition, a comparison between rational and other alternative approaches to management will also be discussed.

2. Rational management approach

3. Critical evaluation of rational management

4. Other alternative management approaches

5. Conclusion

Rational management has become less effective and relevant in the new era of business. This is due to the high degree of risks and uncertainties surrounding contemporary business environment. The dynamic and rapidly changing economic, social, and political conditions create a pressure on business leaders to constantly evolve and adapt to the new situation. Management is required to possess a new skills set and acquire new management philosophy for their organization. Under this context, a non-linear approach to problem solving is more critical and appropriate to successful performance. Leaders will have to be more flexible, embracing changes and autonomy, and promote employees’ commitment and satisfactions while gradually give up the traditional micro-management, incentives/punishments supervisory method.

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