Chapter 02 The Evolution of Management Thinking

The Evolution of Management Thinking

Chapte

r 2

Copyright © 2005 by South-Western, a division of Thomson Learning. All rights reserved.

2

New Approach to Management

Success accrues to those who learn how

To be leaders

To Initiate change

To participate in and create organizations

– with fewer managers

– With less hierarchy that can change quickly


3

Management and Organization

Management philosophies and organization

forms change over time to meet new needs

Some ideas and practices from the past are

still relevant and applicable to management

today


4

Historical Perspective

Provides a context or environment

Develops an understanding of societal impact

Achieves strategic thinking

Improves conceptual skills

Social, political, and economic forces have

influenced organizations and the practice of

management


5

Forces Influencing Organizations and Management

Social Forces - values, needs, and standards of behavior

Political Forces - influence of political and legal institutions on people & organizations

Economic Forces - forces that affect the availability, production, & distribution of a society’s resources among competing users


6

Management Perspectives Over Time

1930Humanistic Perspective

19901890Classical

1940

1950

2000Systems Theory

2000

2010

The Technology-Driven Workplace

1990

2010

The Learning Organization

1970Contingency Views

2000

1980Total Quality Management

2000

1940Management Science Perspective

1990

20101870

Exhibit 2.1, p.44


7

Classical Perspective: 3000 B.C.

● Rational, scientific approach to

management – make organizations

efficient operating machines

● Scientific Management

● Bureaucratic Organizations

● Administrative Principles


8

Scientific Management: Taylor 1856-1915

General Approach

Developed standard method for performing each job.

Selected workers with appropriate abilities for each job.

Trained workers in standard method.

Supported workers by planning work and eliminating interruptions.

Provided wage incentives to workers for increased output.


9

Scientific Management

Contributions Demonstrated the importance of compensation for performance.

Initiated the careful study of tasks and jobs.

Demonstrated the importance of personnel and their training.

Criticisms Did not appreciate social context of work and higher needs of

workers.

Did not acknowledge variance among individuals.

Tended to regard workers as uninformed and ignored their ideas


10

Bureaucracy Organizations

Max Weber 1864-1920

Prior to Bureaucracy Organizations– European employees were loyal to a single individual

rather than to the organization or its mission

– Resources used to realize individual desires rather than organizational goals

Systematic approach –looked at organization as a whole

Ethical Dilemma: The Supervisor


11

Bureaucracy Organizations

Positions organized

in a hierarchy of authority

Managers subject to

Rules and procedures

that will ensure reliable

predictable behavior

Personnel are selected

and promoted based

on technical

qualifications

Administrative acts

and decisions recorded

in writing

Management separate

from the ownership

of the organization

Division of labor

with Clear definitions of

authority and responsibility

Exhibit 2.3, p. 49


12

Administrative Principles

Contributors: Henri Fayol, Mary Parker,

and Chester I. Barnard

Focus:

– Organization rather than the individual

– Delineated the management functions of

planning, organizing, commanding,

coordinating, and controlling


13

Henri Fayol 1841-1925

Division of labor

Authority

Discipline

Unity of command

Unity of direction

Subordination of

individual interest

Remuneration

Centralization

Scalar chain

Order

Equity

Stability and

tenure of staff

Initiative

Esprit de corps

14 General Principles of Management


14

Mary Parker Follett 1868-1933

Importance of common super-ordinate goals for reducing conflict in organizations

– Popular with businesspeople of her day

– Overlooked by management scholars

– Contrast to scientific management

– Reemerging as applicable in dealing with rapid change in global environment

Leadership – importance of people vs. engineering techniques

Ethics - Power - Empowerment


15

Chester Barnard 1886-1961

Informal Organization

– Cliques

– Naturally occurring social groupings

Acceptance Theory of Authority

– Free will

– Can choose to follow management orders


16

Humanistic Perspective

Emphasized understanding human behavior,

needs, and attitudes in the workplace

● Human Relations Movement

● Human Resources Perspective

● Behavioral Sciences Approach


17

Human Relations Movement

Emphasized satisfaction of employees’

basic needs as the key to increased

worker productivity


18

Hawthorne Studies

Ten year study

Four experimental & three control groups

Five different tests

Test pointed to factors other than illumination for productivity

1st Relay Assembly Test Room experiment, was controversial, test lasted 6 years

Interpretation, money not cause of increased output

Factor that increased output, Human Relations


19

Human Resource Perspective

Suggests jobs should be designed to meet

higher-level needs by allowing workers to

use their full potential


20

Physiological

Safety

Belongingness

Esteem

Self-

actualization

Abraham Maslow’s

Hierarchy of Needs

Based on needs satisfaction

1908-1970

Chapter 16 – Maslow in more detail


21

Dislike work –will avoid it

Must be coerced,

controlled, directed, or

threatened with

punishment

Prefer direction, avoid

responsibility, little

ambition, want security

Do not dislike work

Self direction and self

control

Seek responsibility

Imagination, creativity

widely distributed

Intellectual potential

only partially utilized

Douglas McGregor Theory X & Y

Theory X Assumptions Theory Y Assumptions

1906-1964


22

Douglas McGregor Theory X & Y

Few companies today still use Theory X

Many are trying Theory Y techniques

Experiential Exercise: Theory X and Theory Y Scale


23

Behavioral Sciences Approach

Applies social science in an organizational

context

Draws from economics, psychology,

sociology, anthropology, and other

disciplines

– Understand employee behavior and interaction

in an organizational setting

– OD – Organization Development

Sub-field of the Humanistic Management Perspective


24

Management Science Perspective

Emerged after WW II

Applied mathematics, statistics, and other

quantitative techniques to managerial

problems

Operations Research – mathematical modeling

Operations Management – specializes in physical

production of goods or services

Information Technology – reflected in management

information systems


25

Recent Historical Trends

● Systems Theory

● Contingency View

● Total Quality Management (TQM)


26

Systems View of Organizations

Exhibit 2.5, p. 58


27

Contingency View of Management

Exhibit 2.6, p. 59

Successful resolution of organizational problems is thought to

depend on managers’ identification of key variations in the

situation at hand


28

Elements of a Learning Organization

Learning

Organization

Open

Information

Empowered

Employees

Team-Based Structure

Exhibit 2.7, p. 61


29

Types of E-Commerce

Business-to-Consumer B2C

Selling Products and

Services Online

Business-to-Business B2B

Transactions Between

Organizations

Consumer-to-Consumer C2C

Electronic Markets

Created by Web-Based

Intermediaries

Exhibit 2.8, p. 63

Leadership & Management

Chapter 02 The Evolution of Management Thinking