Management is a quite fresh discipline across the globe that has influences and ideas from various scientific fields, such as economics, sociology, philosophy, and psychology, and can be approached from several different perspectives (Bose, D.C., 2012). Luthans’s (1988) theories and studies have given great emphasis on managing organisations from a sociological and psychological perspective. For Luthans (1988) the human element is vital within organisations and therefore the human capital and the everyday activities that managers deliver is the key factor for today’s organisations’ high performance, innovation, and success.
Simultaneously, Luthans (1988) has attempted to make clear the routine managers’ activities and has developed ideas regarding achieving organisations high performance, effectiveness, and competitive advantage. Luthans (1988), seems to agree with both Fayol (1949) and Mintzberg (1990) on the idea that managers’ work and activities are very essential parts of the organisations’ operation, with the later to comment that managers deliver the most significant job within the society. This essay will attempt to critically present an analysis of Luthans’s (1988) contribution and implementations in relation to management theory.
Today’s organisations have to deal with performance issues that should be tackled by promoting organisations capable managers with high potentials instead of searching for a governmental or an advanced and complex technical solution (Luthans (1988)). Luthans (1988) believes that the daily activities of today’s managers are essential elements that affect significantly an organisation’s performance. Luthans’s (1988) study on forty-four ‘real” managers from different organisation’s levels and types, especially from the service sector such as hospitals, financial institutes, government agencies, retail stores, has discovered their everyday activities and categorised them in four groups; communication, traditional management, networking, and human resource management. Nevertheless, the communication activities tend to be similar to those of the interpersonal role of Mintzberg’s (1990) manager, the traditional management activities appear similarities with Fayol’s (1949) functions of management in terms of planning, decision making and controlling, and the networking activities are close to Kotter’s (1982) ‘network building”. Thus, it seems that some of Luthans (1988) findings in routine managers’ activities are already mentioned but he took a step further by adding the element of the human resource management. Despite this, Luthans’s (1988) study and categorisation of the managers’ routine activities even though it contains elements and terms of Fayol’s (1949), Mintzberg’s (1990), and Kotter’s (1982) work, it seems to be more accurate. Its outcomes are the result of using a scientific method for gathering data (Delphi technique) unlike Fayol’s (1949) work which is not based on empirical evidence, and at the same time Luthans’s sample of managers was larger and more general instead of Mintzberg’s (1990), and Kotter’s (1982) which contained only five CEOs and fifteen successful managers, respectively. Based on the above four activities (communication, traditional management, networking and human resource management) that Luthans (1988) has found he defines the two types of ‘real” managers; the successful – those ‘who have been promoted relatively quickly”- and the effective ” those ‘who have satisfied, committed subordinates and high performing units”. Successful managers spent most of their time performing networking activities and the least on human resource and traditional management activities while the effective ones spend most of their time on communication and human resource management activities and the least on traditional management and networking activities (Luthans (1988). Thus, very few managers achieve to be both successful and effective. Luthans (1988) states that in practice the successful managers are promoted instead of the effective ones since the formers emphasise the most on networking, which finally results in performing organisational issues. Hence, Luthans (1988) suggests that aiming to tackle these problems organisations, especially the Americans ones which mostly promote the successful managers, should encourage effective managers to get promoted while they have to learn networking skills so as to be reached a balance between successful and effective managers. In other words, in this way managers would manage to be quickly promoted, efficient and productive which would contribute to the organisation’s good performance and reputation.Nevertheless, Mintzberg (1990) believes that effective managers are likely those who have developed an introspective sense of their work and perform efficiently under job pressure. Mintzberg (1990) states that managers’ formal authority results in them performing three dependable interpersonal, informational and decisional roles with the greatest emphasis to be given on the informational roles and its communication activities since 40% of CEOs’ contact time was about information sharing and 70% of their received mails was only for informational purposes. Consequently, it seems that Mintzberg’s (1990) managers and Luthans’s (1988) effective manager spend most of their time in communication activities and at the same time Luthans’s (1988) successful manager activities have great similarities with those of Mintzberg’s (1990) interpersonal managerial role. However, both Luthans (1988) and Mintzberg’s’ (1990) managerial activities models seem to include elements from Fayol’s (1949) five functions of management; planning, organisation, command, co-ordination and control, with Mintzberg to comment that managers’ decision-making processes ‘are the same as the procedures used by nineteenth-century managers”. Luthans’s (2004) works with Kyle W. Luthans (2004) and Brett C. Luthans (2004) and also with Carolyn M. Youssef (2004), have concluded that today’s organisations should replace the traditional economic capital and invest in human and social capital as well as in positive psychological capital, so as organisations at first to achieve competitive advantage and afterwards maintain it. Moreover, ‘only half of today’s organisations and their managers believe that human resources really do matter” while ‘half of those who believe” that human resources are their most important asset do something about it” ” (Jeffery Pfeffer (1988)). Jeffery Pfeffer (1988) has also reached the conclusion that global organisations with high productivity, innovation, quality, customer satisfaction, and bottom-line profitability, such as Southwest Airlines Co., General Electric Co., Microsoft Corp. actually invest in human resource and thus they do not treat it as an expenditure. For instance, the heads of Intel Corporation’s Andy Grove and Microsoft’s Bill Gates have commented that our most important asset walks out of the door every night.” Thus, it seems that today’s organisations which invest in human capital actually appreciate and have deep faith in their employees’ skills, capabilities and potentials, and consider them as the key to survival and success in today’s market. According to the work of Luthans and Carolyn Youssef (2004), the human resource capital with a special emphasis on tacit knowledge is the key that provides a competitive advantage and can maintain organisations’ long-run profits. The main reason is that tacit knowledge cannot be copied unlike elements such as organisational structure, high tech environment, and employees’ technical training programmes, work experience, education, and specialisation that can be imitated. Investing organisations in tacit knowledge, positive psychological capital ” one’s development and improvement through self-efficacy, hope, optimism and resiliency – and social capital’s elements; networks, norms and trust, seems to contribute significantly in organisation’s high performance and success since its employees have a clear understanding of the organisation’s structure, goals, vision, culture, philosophy, norms and values (Luthans and Youssef (2004)). Therefore, organisations are able to develop a great competitive advantage, innovation, and creativity which during difficult times may help them maintain their profits and revenues (Luthans and Youssef (2004)). However, Luthans’s (2004) and Youssef’s’ (2004) approach on social capital seems brief and not much in detail and as a result, it does not make clear enough the role and the position of the organisations within the society, the influence of society on organisations and vice versa, and the relationship between society and organisations. Furthermore, in organisations such as the Armed forces and the police, this managerial model seems not practical since they do not need high innovation or creativity in order to survive. In fact, such kind of organisations are based on Max Weber’s (1950) bureaucratic model and in order to be effective they depend on formal structure, tall hierarchy, individual’s task specialisation and impersonal delivery of given tasks. Simultaneously, regarding their operating environment and structure, these organisations are also close to Burns’s (2000) and Stalker’s (2000) mechanistic model and Henry Mintzberg’s (1990) machine bureaucracy model, which means that such organisations’ nature and level of efficiency are depending on pure bureaucracy. Nevertheless, optimism and especially self-efficacy may turn to be beneficial in some cases such as the military, as cadets with great self-confidence and optimism are more likely to develop ‘leadership potential” (Chemers, Watson and May (2000)). To sum up, Luthans (1988) throughout his work has attempted to illustrate from a sociological and phycological perspective the importance of the human element within an organisation as a means of effectiveness and competitive advantage. Luthans’s (1988) studies have given great emphasis on the daily activities that modern managers perform, in order to discover with scientific evidence, the real managerial activities and based on them he introduced the different types of managers in relation to effectiveness and personal success. However, as mentioned Luthans (1988) has taken a step further beyond Fayol’s (1949) and Mintzberg’s (1990) work on discovering the routine managerial activities. Luthans’s (1988) findings and conclusions seem to have great similarities with those of Fayol’s (1949), Mintzberg’s (1990) and Kotter’s (1982) but they appear to be more accurate. Simultaneously, Luthans (1988) has suggested managerial models and methods, such as creating a combination of an effective and a successful manager and investing in human resource management, social capital, tacit knowledge, and positive psychological capital, so as organisations to achieve high performance, innovation, and long-lasting competitive advantage. Luthans’s (1988) managerial advice and models seem to apply in organisations with the desire innovation and creativity such as Microsoft and Intel, while in some others, like the military, they appear impractical since their effectiveness is based on pure bureaucracy. Finally, every organisation has its own needs and resources so based on those, it should choose the most applicable managerial model for itself as at the present there is no universal and ideal managerial model that can guarantee effectiveness and success to any type of organisation.