1 evolution of management

7/24/2019 1 Evolution of Management

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TheTheEvolutionEvolution ofofManagementManagement

TheoryTheory


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What is an Organization?What is an Organization?

Organizations are social entities thatOrganizations are social entities thatare goal-oriented; are designed asare goal-oriented; are designed as

deliberately structured anddeliberately structured andcoordinated activity systems, and arecoordinated activity systems, and are

linked to the external environmentlinked to the external environment

!a"t, #$$%&!a"t, #$$%&''


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Organization theory andOrganization theory and

(anagement(anagement (anagement technology stems(anagement technology stems

"rom organization theory and even"rom organization theory and even

more a))lied in the sense that itmore a))lied in the sense that it"ocuses on the )ractice o""ocuses on the )ractice o"

management in ongoingmanagement in ongoing

organizationsorganizations *ast+osenzeig./0$&*ast+osenzeig./0$&''


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(icro 1ers)ective o"(icro 1ers)ective o"

OrganizationsOrganizations 2im)li"ying 3ssum)tions42im)li"ying 3ssum)tions4

5 6irms vieed as an individual entre)reneur6irms vieed as an individual entre)reneur

5 1ro7t maximization1ro7t maximization5 ationality in achieving 7rm goalsationality in achieving 7rm goals

5 6irms "unction is to trans"orm in)uts into6irms "unction is to trans"orm in)uts into

out)utsout)uts

5 2ta)le environment in hich 7rm o)erates2ta)le environment in hich 7rm o)erates5 8oncerned only ith changes in )rices and8oncerned only ith changes in )rices and

9uantities o" in)uts and out)uts9uantities o" in)uts and out)uts


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:volution O" (anagement:volution O" (anagement

houghthought

.$

Systematicmanagement

Administrativemanagement

Quantitativemanagement

Systemstheory

Current andfuture revolution

Scienticmanagement

Humanrelations

Organizationalbehavior

ureaucracy

8lassical 3))roaches 8ontem)orary 3))roaches

Contingencytheory


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Early Management Conce!ts "Early Management Conce!ts "

#n$uences#n$uences @ndustrial revolution@ndustrial revolution5 minor im)rovements in management tacticsminor im)rovements in management tactics

)roduced im)ressive increases in )roduction)roduced im)ressive increases in )roduction

9uantity and 9uality9uantity and 9uality

5 economies of scaleeconomies of scale- reductions in the- reductions in the

average cost o" a unit o" )roduction as theaverage cost o" a unit o" )roduction as the

total volume )roduced increasestotal volume )roduced increases

5 o))ortunities "or mass )roduction created byo))ortunities "or mass )roduction created by

the industrial revolution s)aned intensethe industrial revolution s)aned intense

and systematic thought about managementand systematic thought about management

)roblems and issues)roblems and issues e%ciencye%ciency

!roduction !rocesses!roduction !rocesses

cost savingscost savings


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Theories of ManagementTheories of Management

S c i e n t i f i c

M a n a g e m e n t

B u r e a u c r a t i c

M a n a g e m e n t

A d m i n i s t r a t i v eM a n a g e m e n t

C l a s s i c a l

T h e o r i e s

B e h a v i o u r i s t

T h e o r i e s

H a w t h o r n e

S t u d i e s

H u m a nR e l a t i o n s

B e h a v i o u r a l

S c i e n c e


T h e o r i e s

M a n a g e m e n t

S c i e n c e

O p e r a t i o n s

M a n a g e m e n t

M a n a g e m e n tI n f o r m a t i o n

S y s t e m s

Q u a n t i t a t i v e

T h e o r i e s

S y s t e m s

T h e o r y

C o n t i n g e n c y

T h e o r y

m e r g i n g! i e w s

C o n t e m p o r a r y

T h e o r i e s

M a n a g e m e n t

T h e o r y


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Theories ofTheories of

ManagementManagement

S c i e n t i f i c

M a n a g e m e n t


M a n a g e m e n t

A d m i n i s t r a t i v e

M a n a g e m e n t

C l a s s i c a l

T h e o r i e s


T h e o r i e s

H a w t h o r n e

S t u d i e s

H u m a n

R e l a t i o n s


S c i e n c e


T h e o r i e s

M a n a g e m e n t

S c i e n c e

O p e r a t i o n s

M a n a g e m e n t

M a n a g e m e n t

I n f o r m a t i o n

S y s t e m s


T h e o r i e s

S y s t e m s

T h e o r y


T h e o r y

m e r g i n g

! i e w s


T h e o r i e s

M a n a g e m e n t

T h e o r y

CLASSICALCLASSICAL

THEORIESTHEORIES

CLASSICALCLASSICAL

THEORIESTHEORIES

SCIENTIFICSCIENTIFIC

MANAGEMENTMANAGEMENT

SCIENTIFICSCIENTIFIC



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&rederic' Taylor&rederic' Taylor!evelo)ed the s)eci7c )rinci)les o"!evelo)ed the s)eci7c )rinci)les o"

2cienti7c (anagement2cienti7c (anagement

2cienti7c (anagement2cienti7c (anagement

he systematic study o" the relationshi)she systematic study o" the relationshi)s

beteen )eo)le and tasks "or the )ur)osebeteen )eo)le and tasks "or the )ur)ose

o" redesigning the ork )rocess "or highero" redesigning the ork )rocess "or higher

eAciency'eAciency'!e7ned by 6rederick aylor in the late .


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Taylor(s ) *rinci!les ofTaylor(s ) *rinci!les of

Scientic ManagementScientic Management 2cienti7cally study each )art o" a2cienti7cally study each )art o" a

task and develo) the best method "ortask and develo) the best method "or

)er"orming the task)er"orming the task

8are"ully select orkers and train8are"ully select orkers and trainthem to )er"orm the task by usingthem to )er"orm the task by usingthe scienti7cally develo)ed methodthe scienti7cally develo)ed method


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Taylor(s ) *rinci!les ofTaylor(s ) *rinci!les of

Scientic ManagementScientic Management 8oo)erate "ully ith orkers to ensure8oo)erate "ully ith orkers to ensure

that they use the )ro)er methodthat they use the )ro)er method

!ivide ork and res)onsibility so that!ivide ork and res)onsibility so thatmanagement is res)onsible "ormanagement is res)onsible "or

)lanning ork methods using scienti7c)lanning ork methods using scienti7c)rinci)les and orkers are res)onsible)rinci)les and orkers are res)onsible

"or executing the ork accordingly"or executing the ork accordingly


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1roblems ith 2cienti7c1roblems ith 2cienti7c

(anagement(anagement

(anagers "re9uently im)lemented only the(anagers "re9uently im)lemented only theincreased out)ut side o" aylorBs )lan'increased out)ut side o" aylorBs )lan'

5 Workers did not share in the increased out)ut'Workers did not share in the increased out)ut'

2)ecialized Cobs became very boring, dull'2)ecialized Cobs became very boring, dull'5 Workers ended u) distrusting the 2cienti7cWorkers ended u) distrusting the 2cienti7c

(anagement method'(anagement method' Workers could )ur)osely under-)er"orm'Workers could )ur)osely under-)er"orm'

5 (anagement res)onded ith increased use o"(anagement res)onded ith increased use o"

machines and conveyors belts'machines and conveyors belts'


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6ayolBs 1rinci)les o"6ayolBs 1rinci)les o"

(anagement(anagement!ivision o" Dabor4 allos "or Cob s)ecialization'!ivision o" Dabor4 allos "or Cob s)ecialization'

5 6ayol noted Cobs can have too much s)ecialization6ayol noted Cobs can have too much s)ecialization

leading to )oor 9uality and orker dissatis"action'leading to )oor 9uality and orker dissatis"action'

3uthority and es)onsibility3uthority and es)onsibility

5 6ayol included both "ormal and in"ormal authority6ayol included both "ormal and in"ormal authority

resulting "rom s)ecial ex)ertise'resulting "rom s)ecial ex)ertise'

Enity o" 8ommandEnity o" 8ommand

5 :m)loyees should have only one boss':m)loyees should have only one boss'


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(anagement contBd&(anagement contBd& Dine o" 3uthorityDine o" 3uthority

5 3 clear chain o" command "rom to) to bottom3 clear chain o" command "rom to) to bottom

o" the 7rm'o" the 7rm'

8entralization8entralization5 he degree to hich authority rests at the to)he degree to hich authority rests at the to)

o" the organization'o" the organization'

Enity o" !irectionEnity o" !irection5 3 single )lan o" action to guide the3 single )lan o" action to guide the

organization'organization'


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6ayolBs 1rinci)les o" (anagement6ayolBs 1rinci)les o" (anagement

contBd&contBd&

:9uity:9uity5he )rovision o" Custice and the "air and im)artialhe )rovision o" Custice and the "air and im)artial

treatment o" all em)loyees'treatment o" all em)loyees'

OrderOrder5he arrangement o" em)loyees here they ill behe arrangement o" em)loyees here they ill be

o" the most value to the organization and too" the most value to the organization and to

)rovide career o))ortunities')rovide career o))ortunities'

@nitiative@nitiative5he "ostering o" creativity and innovation byhe "ostering o" creativity and innovation by

encouraging em)loyees to act on their on'encouraging em)loyees to act on their on'


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(anagement contBd&(anagement contBd& !isci)line!isci)line5 Obedient, a))lied, res)ect"ul em)loyees areObedient, a))lied, res)ect"ul em)loyees are

necessary "or the organization to "unction'necessary "or the organization to "unction'

emuneration o" 1ersonnelemuneration o" 1ersonnel5 3n e9uitable uni"orm )ayment system that3n e9uitable uni"orm )ayment system thatmotivates contributes to organizational success'motivates contributes to organizational success'

2tability o" enure o" 1ersonnel2tability o" enure o" 1ersonnel

5 Dong-term em)loyment is im)ortant "or theDong-term em)loyment is im)ortant "or thedevelo)ment o" skills that im)rove thedevelo)ment o" skills that im)rove the

organizationBs )er"ormance'organizationBs )er"ormance'


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(anagement contBd&(anagement contBd& 2ubordination o" @ndividual @nterest to2ubordination o" @ndividual @nterest to

the 8ommon @nterestthe 8ommon @nterest

5he interest o" the organization takeshe interest o" the organization takes)recedence over that o" the individual)recedence over that o" the individual

em)loyee'em)loyee'

:s)rit de cor)s:s)rit de cor)s5 8omradeshi), shared enthusiasm "oster8omradeshi), shared enthusiasm "oster

devotion to the common causedevotion to the common cause

organization&'organization&'


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3dministrative (anagement3dministrative (anagement

heoryheory3dministrative (anagement3dministrative (anagement

5he study o" ho to create an organizationalhe study o" ho to create an organizational

structure that leads to high eAciency andstructure that leads to high eAciency andeFectiveness'eFectiveness'

(ax Weber(ax Weber5 !evelo)ed the conce)t o" bureaucracy as a!evelo)ed the conce)t o" bureaucracy as a

"ormal system o" organization and"ormal system o" organization andadministration designed to ensure eAciencyadministration designed to ensure eAciency

and eFectiveness'and eFectiveness'


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WeberBs 1rinci)les o" GureaucracyWeberBs 1rinci)les o" Gureaucracy

"igure $%$


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WeberBs 6ive 1rinci)les o"WeberBs 6ive 1rinci)les o"

GureaucracyGureaucracy 3uthority is the )oer to hold )eo)le accountable3uthority is the )oer to hold )eo)le accountable

"or their actions'"or their actions'

1ositions in the 7rm should be held based on1ositions in the 7rm should be held based on)er"ormance, not social contacts')er"ormance, not social contacts'

1osition duties are clearly identi7ed so that )eo)le1osition duties are clearly identi7ed so that )eo)lekno hat is ex)ected o" them'kno hat is ex)ected o" them'

Dines o" authority should be clearly identi7ed suchDines o" authority should be clearly identi7ed suchthat orkers kno ho re)orts to ho'that orkers kno ho re)orts to ho'

ules, standard o)erating )rocedures 2O1s&, andules, standard o)erating )rocedures 2O1s&, andnorms guide the 7rmBs o)erations'norms guide the 7rmBs o)erations'


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S c i e n t i f i c

M a n a g e m e n t


M a n a g e m e n t


M a n a g e m e n t

C l a s s i c a l

T h e o r i e s


T h e o r i e s

H a w t h o r n e

S t u d i e s

H u m a n

R e l a t i o n s


S c i e n c e


T h e o r i e s

M a n a g e m e n t

S c i e n c e

O p e r a t i o n s

M a n a g e m e n t

M a n a g e m e n t


S y s t e m s


T h e o r i e s

S y s t e m s

T h e o r y


T h e o r y

m e r g i n g

! i e w s


T h e o r i e s

M a n a g e m e n t

T h e o r y

BEHAVIOURALBEHAVIOURAL

THEORIESTHEORIES


THEORIESTHEORIES

HAWTHORNEHAWTHORNE

STUDIESSTUDIES

HAWTHORNEHAWTHORNE

STUDIESSTUDIES


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Gehavioural heoriesGehavioural heories

:m)hasise the im)ortance:m)hasise the im)ortance

o" attem)ting to understando" attem)ting to understandthe various "actors thatthe various "actors that

aFect human behaviour inaFect human behaviour in

organisations'organisations'


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he Hathorne 2tudieshe Hathorne 2tudies

3 grou) o" studies conducted3 grou) o" studies conducted

at the Hathorne )lant o" theat the Hathorne )lant o" the

Western :lectric 8om)anyWestern :lectric 8om)any

during the late ./#$Bs andduring the late ./#$Bs and

early ./=$Bsearly ./=$Bs


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Hathorne 2tudiesHathorne 2tudies

esearchers monitored the )roductivityesearchers monitored the )roductivity

o" 7ve omen ho assembled electricalo" 7ve omen ho assembled electrical

relays "or several years'relays "or several years'


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S c i e n t i f i c

M a n a g e m e n t


M a n a g e m e n t


M a n a g e m e n t

C l a s s i c a l

T h e o r i e s


T h e o r i e s

H a w t h o r n e

S t u d i e s

H u m a n

R e l a t i o n s


S c i e n c e


T h e o r i e s

M a n a g e m e n t

S c i e n c e

O p e r a t i o n s

M a n a g e m e n t

M a n a g e m e n t


S y s t e m s


T h e o r i e s

S y s t e m s

T h e o r y


T h e o r y

m e r g i n g

! i e w s


T h e o r i e s

M a n a g e m e n tT h e o r y


THEORIESTHEORIES


THEORIESTHEORIES

HUMANHUMAN

RELATIONSRELATIONS

HUMANHUMAN

RELATIONSRELATIONS


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MaslowsMaslows

HierarchyHierarchyof Nee!sof Nee!s

Basic Nee!sBasic Nee!s

Safe"y # Sec$ri"ySafe"y # Sec$ri"y

Nee!sNee!s

SocialSocial

Nee!sNee!s

SelfSelfEs"ee%Es"ee%

SelfSelfAc"$alisa"io&Ac"$alisa"io&


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heory I + heory Jheory I + heory J

Theory +Theory +he average )erson dislikes ork and ill tryhe average )erson dislikes ork and ill try

to avoid it'to avoid it'

(ost )eo)le need to be coerced, controlled,(ost )eo)le need to be coerced, controlled,directed, and threatened ith )unishment todirected, and threatened ith )unishment toget them to ork toards organisational goals'get them to ork toards organisational goals'

he average )erson W3K2 to be directed,he average )erson W3K2 to be directed,shuns res)onsibility, has little ambition, andshuns res)onsibility, has little ambition, and

seeks security above all'seeks security above all'


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Theory ,Theory , (ost )eo)le do not inherently dislike ork;(ost )eo)le do not inherently dislike ork;

it is seen as natural as recreation and rest'it is seen as natural as recreation and rest'

1eo)le ill exercise sel"-direction and sel"-1eo)le ill exercise sel"-direction and sel"-control to reach goals to hich they arecontrol to reach goals to hich they arecommitted'committed'

8ommitment to goals is a "unction o" the8ommitment to goals is a "unction o" the

reards available; )articularly esteem andreards available; )articularly esteem andsel"-actualisation needs'sel"-actualisation needs'


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Theory ,Theory , When conditions are "avourable, the averageWhen conditions are "avourable, the average

)erson learns not only to acce)t)erson learns not only to acce)t

res)onsibility, but also to seek it'res)onsibility, but also to seek it'

(any )eo)le have the ca)acity to exercise a(any )eo)le have the ca)acity to exercise ahigh degree o" creativity and innovation inhigh degree o" creativity and innovation in

solving organisation )roblems'solving organisation )roblems'

he intellectual )otential o" most individualshe intellectual )otential o" most individualsis only )artially utilised in most organisations'is only )artially utilised in most organisations'


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S c i e n t i f i c

M a n a g e m e n t


M a n a g e m e n t


M a n a g e m e n t

C l a s s i c a l

T h e o r i e s


T h e o r i e s

H a w t h o r n e

S t u d i e s

H u m a n

R e l a t i o n s


S c i e n c e


T h e o r i e s

M a n a g e m e n t

S c i e n c e

O p e r a t i o n s

M a n a g e m e n t

M a n a g e m e n t


S y s t e m s


T h e o r i e s

S y s t e m s

T h e o r y


T h e o r y

m e r g i n g

! i e w s


T h e o r i e s


'UANTITATIVE'UANTITATIVE

THEORIESTHEORIES

'UANTITATIVE'UANTITATIVE

THEORIESTHEORIES


INFORMATIONINFORMATION

S(STEMSS(STEMS


INFORMATIONINFORMATION

S(STEMSS(STEMS


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(anagement @n"ormation(anagement @n"ormation

2ystems2ystems6ocuses on designing and6ocuses on designing andim)lementing com)uter-basedim)lementing com)uter-based

in"ormation systems "or use byin"ormation systems "or use by

management'management'

hese systems turn ra datahese systems turn ra data

into in"ormation that is use"ul tointo in"ormation that is use"ul to

various levels o" management'various levels o" management'


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S c i e n t i f i c

M a n a g e m e n t


M a n a g e m e n t


M a n a g e m e n t

C l a s s i c a l

T h e o r i e s


T h e o r i e s

H a w t h o r n e

S t u d i e s

H u m a n

R e l a t i o n s


S c i e n c e


T h e o r i e s

M a n a g e m e n t

S c i e n c e

O p e r a t i o n s

M a n a g e m e n t

M a n a g e m e n t


S y s t e m s


T h e o r i e s

S y s t e m s

T h e o r y


T h e o r y

m e r g i n g

! i e w s


T h e o r i e s


CONTEM)ORAR(CONTEM)ORAR(

THEORIESTHEORIES


THEORIESTHEORIES

S(STEMSS(STEMS

THEOR(THEOR(

S(STEMSS(STEMS

THEOR(THEOR(


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2ystems heory2ystems heory

ased on the idea thatased on the idea thatorganisations can beorganisations can be

visualised as systemsvisualised as systems

SystemSystem

A set of interrelatedA set of interrelated!arts that o!erate as a!arts that o!erate as a

-hole in !ursuit of-hole in !ursuit of

common goalscommon goals


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2ystems heory2ystems heory

.evelo!ed.evelo!ed

throughthrough

thethesciences ofsciences of

iologyiology

andand*hysical*hysical

ScienceScience


35/41

I&*$"sI&*$"sTra&sfor%a"io&Tra&sfor%a"io&

)rocesses)rocesses O$"*$"sO$"*$"s

Fee!+ac, fro% E&-iro&%e&"Fee!+ac, fro% E&-iro&%e&"

Reso$rcesReso$rces

H$%a&H$%a&

Ma"erialsMa"erials

E.$i*%e&"E.$i*%e&"

Fi&a&ceFi&a&ce

I&for%a"io&I&for%a"io&

A+ili"iesA+ili"ies

)la&&i&/)la&&i&/

Or/a&isi&/Or/a&isi&/

Lea!i&/Lea!i&/

Co&"rolCo&"rol

Tech&olo/yTech&olo/y

O$"co%esO$"co%es

)ro!$c"s)ro!$c"s

Ser-icesSer-ices

)rofi" # Losses)rofi" # Losses

E%*loyeeE%*loyee

Grow"h #Grow"h #

Sa"isfac"io&Sa"isfac"io&


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O)en vs' 8losed 2ystemsO)en vs' 8losed 2ystems

Closed SystemClosed SystemA system that does littleA system that does little

or no interacting -ith itsor no interacting -ith its

environment and receivesenvironment and receiveslittle feedbac'little feedbac'

O!en SystemO!en System

A system that o!erates inA system that o!erates in

continual interaction -ithcontinual interaction -ith

its environmentits environment

h i fTh i f


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S c i e n t i f i c

M a n a g e m e n t


M a n a g e m e n t


M a n a g e m e n t

C l a s s i c a l

T h e o r i e s


T h e o r i e s

H a w t h o r n e

S t u d i e s

H u m a n

R e l a t i o n s


S c i e n c e


T h e o r i e s

M a n a g e m e n t

S c i e n c e

O p e r a t i o n s

M a n a g e m e n t

M a n a g e m e n t


S y s t e m s


T h e o r i e s

S y s t e m s

T h e o r y


T h e o r y

m e r g i n g

! i e w s


T h e o r i e s



THEORIESTHEORIES


THEORIESTHEORIES

CONTINGENC(CONTINGENC(

THEOR(THEOR(

CONTINGENC(CONTINGENC(

THEOR(THEOR(


38/41

8ontingency heory8ontingency heory

3 vie)oint that argues that3 vie)oint that argues that

a))ro)riate managerial actiona))ro)riate managerial action

de)ends on the circumstances o"de)ends on the circumstances o"

the situation'the situation'

@n other ords LLL''@n other ords LLL''

"here is &o si&/le ri/h" way "o %a&a/e"here is &o si&/le ri/h" way "o %a&a/e


39/41

8ontingency heory8ontingency heory

U&i-ersalU&i-ersalMa&a/e%e&"Ma&a/e%e&"

)ri&ci*als)ri&ci*als

Co&"i&/e&cy ViewCo&"i&/e&cy View

A**ro*ria"eA**ro*ria"e

%a&a/erial%a&a/erial

ac"io& !e*e&!s o&ac"io& !e*e&!s o&

si"$a"io&si"$a"io&

Si"$a"io& ASi"$a"io& A

Si"$a"io& BSi"$a"io& B

Si"$a"io& CSi"$a"io& C

i h


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Contingency TheoryContingency Theory


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1 evolution of management

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