The Evolution of

Management Thinking

Chapter 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

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2
 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

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 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

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 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

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 Management Perspectives Over Time
Exhibit 2.1, p.44

2000
The Technology-Driven Workplace
1990 2010
The Learning Organization
1980 2010
Total Quality Management
2000
1970
Contingency Views
1950 2000
Systems Theory
2000
1940
Management Science Perspective
1930 1990
Humanistic Perspective
1890 1990
Classical
1940 2010
1870
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 Classical Perspective: 3000 B.C.

● Rational, scientific approach to

management – make organizations
efficient operating machines
● Scientific Management
● Bureaucratic Organizations
● Administrative Principles

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 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.

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 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

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 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

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 Bureaucracy Organizations

Division of labor
with Clear definitions of
authority and responsibility
Personnel are selected
and promoted based Positions organized
on technical in a hierarchy of authority
qualifications

Managers subject to
Administrative acts Rules and procedures
and decisions recorded that will ensure reliable
in writing predictable behavior
Management separate
from the ownership
of the organization
Exhibit 2.3, p. 49

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11
 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

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 Henri Fayol 1841-1925
14 General Principles of Management

 Division of labor  Centralization

 Authority  Scalar chain
 Discipline  Order
 Unity of command  Equity
 Unity of direction  Stability and
 Subordination of tenure of staff
individual interest  Initiative
 Remuneration  Esprit de corps
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 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

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 Chester Barnard 1886-1961

 Informal Organization
– Cliques
– Naturally occurring social groupings

 Acceptance Theory of Authority

– Free will
– Can choose to follow management orders

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 Humanistic Perspective

Emphasized understanding human behavior,

needs, and attitudes in the workplace

●Human Relations Movement

●Human Resources Perspective
●Behavioral Sciences Approach

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 Human Relations Movement

Emphasized satisfaction of employees’

basic needs as the key to increased
worker productivity

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 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

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 Human Resource Perspective

Suggests jobs should be designed to meet

higher-level needs by allowing workers to
use their full potential

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 Abraham Maslow’s
Hierarchy of Needs 1908-1970

Self-
actualization
Esteem
Belongingness Chapter 16 – Maslow in more detail

Safety
Physiological
Based on needs satisfaction
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 Douglas McGregor
Theory X & Y 1906-1964
Theory X Assumptions Theory Y Assumptions

 Dislike work –will avoid it  Do not dislike work

 Must be coerced, controlled, directed,  Self direction and self control
or threatened with punishment  Seek responsibility
 Prefer direction, avoid responsibility,  Imagination, creativity widely
little ambition, want security distributed
 Intellectual potential only
partially utilized

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 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

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 Behavioral Sciences Approach
Sub-field of the Humanistic Management Perspective

 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

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 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

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 Recent Historical Trends

● Systems Theory

● Contingency View

● Total Quality Management (TQM)

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 Systems View of Organizations

Exhibit 2.5, p. 58
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 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

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 Elements of a Learning Organization
Team-Based Structure

Learning
Organization
Empowered Open
Employees Information

Exhibit 2.7, p. 61

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 Types of E-Commerce

Business-to-Consumer B2C
Selling Products and
Services Online

Consumer-to-Consumer C2C
Business-to-Business B2B Electronic Markets
Transactions Between Created by Web-Based
Organizations Intermediaries
Exhibit 2.8, p. 63

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