chap 2.evolution(1)

8/6/2019 Chap 2.Evolution(1)

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Evolution of Management


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As any other fields, management too hassome

history.

First Business and Management programmes wereoffered by the Wharton School at the University of

Pennsylvania in 1881.(Bateman & al., 1990)

Management concepts and techniques have existedsince ancient civilisations examples Sumerians,

Egyptians

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Differentschools of management thoughts:

y Scientific Management

y Administrative Management

y Behavioural Management y Management Science/Quantitative

approach/Operations researchapproach/Management Information Systems

y

Sys

tems

approach y Contingency approach

y Theory Z

y TQM

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1) Scientific approach to management

Definition by Frederick Taylor:

-The use of the scientific method to determine

the one best way for a job to be done. -The systematic study of the relationships

between people and tasks to redesign the workfor higher efficiency. Taylor sought to reduce thetime a worker spent on each task by optimizing

the way the task was done. Time and motion study

Standardised tools, differential rate system andbreaks

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Four principles to increase efficiency:

1. The development of a true science of management, sothat the best method for performing each task could be

determined. Study the way the job is performed now anddetermine new ways to do it.

2. Codify the new method into rules. The selection ofworkers so that each worker would be given responsibilityfor the task for which he or she was best suited.

3. The scientific education and development of theworker.

4. Intimate, friendly cooperation between managementand labour. Establish a fair level of performance and payfor higher performance.

Workers should benefit from higher output.

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Taylor contended that the success of these

principles required a complete mental revolution

on the part of management and labour. Rather

than quarrel over profits, both sides should try toincrease production; by so doing, he believed,

profits would rise to such an extent that labour

and management would no longer have to fight

over them. In short, Taylor believed that management and labour had a common interest

in increasing productivity.

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-Managers often implemented only the increasedoutput side of Taylors plan.

-They did not allow workers to share in increased

output.-Specialised jobs became very boring, dull.

-Workers ended up distrusting scientificmanagement.

-Workers could purposely under-perform

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The Gilbreths

Frank and Lillian Gilbreth refined taylorsmethods.

-Made many improvements to time and motionstudies.

Time and motion studies:

1. Break down each action into components

2. Find better ways to perform it 3. Reorganise each action to be more efficient

Gilbreths also studied fatigue problems, lighting,heating and other work issues.

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Seeks to create an organization that leads to bothefficiency and effectiveness.

Max Weber developed the concept of bureaucracy.

A formal system of organization andadministration to ensure effectiveness andefficiency.

-Max Weber (18641920) developed a theory ofbureaucratic management that stressed the

need for a strictly defined hierarchy governed byclearly defined regulations and line of authority.

He considered the ideal organization to abureaucracy whose activities and objectives wererationally thought out and whose divisions of

labour were explicitly spelled out. 10


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A bureaucracy should have:

Written rules Rules, Standard operatingprocedures and norms are used to determine

how the firm operates Hierarchy of authority & Division of

labour Authority is the power to hold peopleaccountable for their actions. Lines ofauthority should be clearly identified.

Workers know who reports to whom. Fair evaluation and reward

System of task relationships/Impersonality Positions in the firm should be held based on

performance not social contacts 11


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Henri Fayol (1841-1925) is generally hailed as

the founder of the classical management school

not because he was the first to investigate

managerial behaviour but because he was thefirst to systematize it.

While, Taylor was basically concerned with

organizational functions (work done in the

organisation), however, Fayol focused on

management, which he felt had been the most

neglected of business operations.

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1. Division of Labour- The more people specialize, the moreefficiently they can perform their work.

2. Authority- Managers must give orders so that they can get

things done. While their formal authority gives them the rightto command, managers will not always compel obedienceunless they have personal authority such as relevantexpertise as well.

3. Discipline- Members in an organization need to respect therules and agreements that govern the organization. To Fayol,

discipline results from good leadership at all levels of theorganization, fair agreements such as provisions forrewarding superior performance, and judiciously enforcedpenalties for infractions.

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4. Unity of Command- Each employee must receive instructionsfrom only one person. Fayol believed that when an employeereported to more than one manager, conflicts in instructions

and confusion of authority would result.5. Unity of Direction- Only one manager using one plan should

direct those operations within the organization that have thesame objective. For example, the personnel department in acompany should not have two directors, each with a different

hiring policy.6. General interest over Individual Interest- In any

undertaking, the interests of employees should not takeprecedence over the interests of the organization as a whole.

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7. Remuneration- Compensation for work done shouldbe fair to both employees and employers

8. Centralization- Decreasing the role of subordinates in

decision-making is centralization: increasing theirrole is decentralization. Fayol believed that managersshould retain final responsibility, but should at thesame time give their subordinates enough authorityto do their jobs properly. The problem is to find theproper degree of centralization in each case.

9.The Hierarchy- The line of authority is a clear chainthat runs from top management to the lowest level ofthe enterprise.

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10.Order- Materials and people should be in theright place at the right time.

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.Equity- Managers should be both friendly andfair to their subordinates.

12.Stability of Staff- A high employee turnoverrate undermines the efficient functioning of anorganization. Long-term employment is

important.13.Initiative- Encourage innovation.

Subordinates should be given the freedom toconceive and carry out their plans, eventhough some mistakes may result.

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14.Esprit de Corps- Promoting team spirit will givethe organization a sense of unity. He suggested,for example, the use of verbal communication

instead of formal, written communicationwhenever possible.

Fayol most frequently had to apply above 14principles of management. Before Fayol, it wasgenerally believed that managers are born, notmade, Fayol insisted, however, that managementwas a skill like any other one that could be taughtonce its underlying principles were understood.

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The behavioural school emerged partly becausethe classical approach did not achieve sufficientproduction, efficiency and workplace harmony.To managers frustration, people did not alwaysfollow predicted or expected patterns of behaviour. Thus there was increased interest inhelping managers deal more effectively with thepeople side of their organizations. Severaltheorists tried to strengthen classicalorganization theory with the insights of sociologyand psychology.

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The most important contribution to thedeveloping OB field came out of the Hawthornestudies, a series of studies conducted at theWestern Electric Company Works.

These studies, started in 1924 and continuedthrough the early 1930s, were initially designedby Western Electric industrial engineers as ascientific management experiment. They wantedto examine the effect of various illuminationlevels on worker productivity.

But to the surprise of the engineers, lightintensity was not directly related to workerproductivity

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Human Relations Movement

Abraham Maslows Hierarchy of Needs (psycological,

safety, social, esteem, self-actualisation)

McGregors Theory X and Y

The Behavioural Science Approach

(economics, psychology, sociology, mathematics)

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In 1927, the Western Electric engineers askedHarvard professor Elton Mayo and his associates tojoin the study as consultants.

- A series of studies was then carried out thatprovided new insights in individual and groupbehaviour. A number of variables were changed andoutcomes on productivity were noted.

The Hawthorne studies of Elton Mayo and hisassociates of the Harvard Business Schoolemphasized the social and behavioural aspects in

work situation. The attention of managers wasdrawn to the fact that, among all the resources thatwere available to organizations, human resourcesconstituted a key resource in the successfulmanagement of organisaiotns.

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What are the contributions and limitations each

of the different theories of the classical school of

thought?

Why did Taylor find it necessary to introduce ascientific approach to management?

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Uses rigorous quantitative techniques tomaximize resources and improve decision-making.

This approach to management involvesapplications of statistics, optimization models,and computer simulations to managementactivities.

Quantitative management utilizes linear

programming, modeling, and simulation systems. Linear programming, for instance is a technique

that mangers use to improve resource allocationdecisions.

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The Systems Approach is a simplified method to

optimize efficiency choices. It considers

relationships inside and outside the organization.

The systems theory considers the impact ofstages, i.e,

Input --------conversion----------output

Managers need to consider the organization as awhole because all segments are interrelated in

one way or another.

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The well-known international economist Charles Kindleberger wasfond of telling his students at MIT that the answer to any reallyengrossing question in economics is It depends. The task of theeconomist, Kindleberger would continue, is to specify upon what itdepends, and in what ways.

The contingency approach (sometimes called the situationalapproach) was developed by managers, consultants and researcherswho tried to apply the concepts of the major schools to real lifesituations. When methods highly effective in one situation failed towork in other situations, they sought an explanation. Why forexample, did an organizational development program work

brilliantly in one situation and fail miserably in another. Advocates ofthe contingency approach had a logical answer to all such questions.Results differ because situations differ a technique that works in onecase will not necessarily work in all cases.

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Entering an era of Dynamic Engagement

1. New organizational environments

2. Ethics and responsibility

3. Globalisation and management

4. Inventing and reinventing organization

5. Cultures and Multiculturalism

6. Quality - TQM

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chap 2.evolution(1)

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