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The New Principles of Management

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Andrzej Kozminski and Dariusz Jemielniak

The New Principles of Management is a textbook meant for European students of principles of management. Developed basing mainly on international cases as well as drawing from international examples of managerial practices, it attempts to address the needs of globalized companies better than other, typically US-centric textbooks. The New Principles of Management challenges many of the fossilized and outdated management notions and covers the topics most relevant for modern 21st century organizations, rather than their historic developments.

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CHAPTER TWO. FORMALIZATION

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CHAPTER TWO FORMALIZATION 38 Chapter Two Key terms and definitions Theory Practical tips A selection of theories and beliefs Max Weber’s Theory Henry Fayol’s Theory Case Studies Parkinson’s Law Customs on books Catch 22 Swietaudit Formalization: Crossword Supplementary reading Formalization “We are obsessed by the idea of regulation, and our Masters of Requests refuse to understand that there is an infinity of things in a great state with which a government should not concern itself” Friedrich M. von Grimm Key terms and definitions Formalization is the formulation of principles, rules and norms, which are binding and regulate the functioning of an organization. The basis of formalization is the need for the standardization, repeatability and predictability of the processes and behaviors within organizations. Thus, formalization prevents spontaneous and unpredictable behaviors. Formalization relies also on organizational authority, which, based on contracts with the members and/or enforcement, requires them to submit to defined and clearly formulated regulations. Thus, formalization facilitates management in such a sense, that it takes away the need for everyday interventions from the managers. It is enough to have junior management formulate the rules, give them to the subordinates and enforce their execution. Formalization makes organizations into machines that function in a predictable, cyclical and rhythmic manner. It also makes them inflexible. It is impossible to guarantee that the standard actions, behaviors and reactions will be an adequate response to unexpected situations. Formalization slows down an organization’s reaction to internal and external events. If the consequences of formalization seriously undermines...

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