Administrative Theory

Administrative Theory

Every entrepreneur and executive faces administrative problems on a daily basis, but some problems are of a more profound nature and require close analysis, the development of alternatives, and a decision as to what to change and how to effect that change. One source of problems is a changed business environment, and since the business environment is always in a state of evolving change, it is important for administrators to monitor such changes and to be prepared to cope with them as they occur. Much of administration theory is dedicated to analyzing the process of change and to showing how to respond to change within the organization. Theorists today see change as accelerating in society, and they offer particular prescriptions for how such change will affect the business environment and how administrators might cope with the developing situation. An analysis of certain theories will lead to an analysis of how change has been handled at one particular company.

ADMINISTRATIVE THEORY – ASSESSING THE BUSINESS ENVIRONMENT

Drucker (1977) describes the role of managers in business and states:

Managers should spend more time and thought on the future of their business. They should also spend more time and thought on a good many other things, their social and community responsibilities for instance. Both they and their business pay a stiff penalty for these neglects. The neglect of the future is only a symptom; executives slight tomorrow because they cannot get ahead of today. . . . The real disease is the absence of any foundation of knowledge and system for tacking the economic tasks in business. (pp. 100-101)

Drucker delineates the economic task as having three dimensions: 1) the present business must be made effective; 2) its potential must be identified and realized; and 3) it must be made into a different business for a different future (p. 101).

McClelland (1961) describes the environment as a source of for…

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