Business Management Ch2 Vocab

Theory X

Assumes that people are basically lazy and will avoid working if they can. Managers impose strict rules and make sure that all important decisions are made only by them. Managers make all decisions, despite how much more or less experience their subordinate may have.

Theory Y

Assumes that people find satisfaction in their work. Managers believe that people will work productively if put in the right environment. People will come up with good ideas if encouraged to do so. Employees can make mistakes and are given freedoms.

Hawthorne Effect

Change of any kind increases productivity (because the workers work harder when they receive attention).

Hierarchy of Needs

Maslow's grouping and ordering of physical, security, social, status, and self-fulfillment needs. People must fulfill their lower needs before they can fulfill needs higher on the pyramid.

Total Quality Management (TQM)

A system of management based on involving all employees in a constant process of improving quality and productivity by improving how they work. It focuses on totally satisfying both customers and employees.

Theory Z

A business management theory that integrates Japanese and American business practices. It incorporates the Japanese emphasis on collective decision making and concern for employees with the American emphasis on individual responsibility.

Trust

A giant industrial monopoly.

William Ouchi

A management research who developed a new theory of management known as Theory Z.

Abraham H. Maslow

A psychologist who developed a theory of motivation which had a significant impact on management.

Interstate Commerce Act

In 1887 Congress passed a law that forced railroads to publish their rates and forbade them to change rates without notifying the public.

Sherman Antitrust Act

In 1890 Congress passed a law which made it illegal for companies to create monopolies.

Monopoly

Occurs when one party maintains total control over a type of industry.

Centralization

Refers to the concentration of power among a few key decision makers.

Scientific Management

Seeks to increase productivity and make work easier by carefully studying work procedures and determining the best methods for performing particular tasks.

Decentralization

The process by which decisions are made by managers at various levels within an organization.

W. Edwards Deming

Used mathematics to help solve problems of quality control. Came up with a mathematically based approach to quality control that became known as total quality management.

Frederick Winslow Taylor

Worked as an apprentice at the Midvale Steel Company and motivated employees to work harder to increase efficiency. He performed time and motion studies to come up with scientific management principals.