chapter 3= management thought

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Management Thought



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Schools of Management Thought



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Schools of Management ThoughtThe Classical School

The Human Relations School

The Decision Theory School

The Management Science School

The System Theory School

The Contingency Theory School



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Classical SchoolThe Scientific Management School

The Management Process School

The Bureaucracy Theory School



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Propounded by Frederick W. Taylor –

Father of Scientific Management (1856-1917)

“that kind of management which conducts a

business or affairs by standards established

by facts or truths gained through systematic

observation, experiment, or reasoning.”

Scientific Management



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Scientific ManagementUse of Scientific Method applied to work

Replace “rule of the thumb”

Observation, Measurement, Experimentation,

Analysis, Rationality and Reasoning are key

instruments for developing managerial systems


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Scientific ManagementBasic Components of Scientific Management

Determination of standards of performance

Functional foremanship

Responsibilities of management

Differential piecework of wage payment

Mental revolution




Determination of Standards of Performance

Famous ‘time & motion’ study

Involves analysis of all the operations and motions involved in each job

and then the motions are times with a stopwatch.

Standards of performance are determined on the basis of time taken on the

performance of each element of the job together with the time needed for

rest and avoidable delays.

An analysis of motions involved in each operation leads to the

identification and elimination of wasteful motions




Functional Foremanship

Separation of planning from doing

Each functional foreman is a specialist in only one kind of work

Functional foremen should plan various aspects of each worker’s job and

issue instructions on their specialty

This shifted the planning function formerly performed by workers and

supervisors to functional specialists like industrial engineers, qualitycontrol experts, safety experts etc.

This increased the cost of managing but reduced the cost of operations




Responsibilities of ManagementManagers should accept the responsibility for planning, directing and

organizing and perform them in a scientific way.

Management should analyze all the operations and develop scientific

methods of operations.

Workers should be scientifically selected and trainedJob specifications - clear, simple and distinct

Develop optimum physical environment




Differential Piecework System of Wage Payment

piece rate systems of pay

establishment of daily output targets for all workers, with monetary

rewards for exceeding targets and penalties for shortfalls




Mental Revolution

Complete mental revolution in the attitudes of managers toward their

fellowman, workers and the ways in which they handle their daily

problems.

Without this complete mental revolution on both sides scientific

management does not exist



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The Management Process SchoolRegards management as a process

Developed by Fayol

5 functions of management; Planning, organizing ,command, coordination and control

14 principles of management regarded as universal

principles applicable in all organizations.



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Bureaucracy Theory School of

Management Propounded by Max Weber

1. There should be a continuing body of rules and all

organizational work should be performed in accordancewith these rules.

2. Specific areas of competence should be determined onthe basis of division of labor, and adequate authority

should be delegated to incumbents for the performanceof organizational work

3. A hierarchy of positions should provide for thesupervision of each office by a higher authority



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Bureaucracy Theory School of

Management

4. Appointments and promotions should be made on thebasis of universalistic criterion of demonstrated

competence. Further people placed in supervisorypositions should be trained in the rules andrequirements of positions.

5. All administrative acts, actions and decisions shouldbe recorded in writing so as to provide for futurescrutiny and permanent record.



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Limitations of Classical TheoriesView organizations as a machine subject to certain

laws

Assume that employees can be motivated by financialincentives alone, and ignore their social and

psychological needs

They are based on the assumption that productivity is

the only criterion of efficiencyOverall approach is mechanistic



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The Human Relation School

Also termed as neo-classical

It emphasises on the human dimension

of management



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Hawthorne Studies

Moved thinking from “economic man” to “social man.”

Increased awareness about employee attitudes and groupattitudes

New hypothesis: motivation to work, morale, andproductivity are related to social relations among theworkers and between the workers and the supervisor , and

not to the physical conditions at work The workers perceived themselves as a work group



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Hawthorne Studies

The group had developed “norms” relating to production

as well as personal conduct among themselves and with the

supervisor

Organization are more than formal structures of positions

and authority responsibility relationships they are indeed

“social system” a system of elite, informal status system,

rituals and a mixture of logical and non logical behavior



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The Decision Theory SchoolPropounded by Simon

Focuses on the decision, the decision making process ,

the decision maker and the environment of the decisionmaker

Looks at management through this keyhole and include

in it the entire field of enterprise operation and its

environmentDecision making is though central to managing, is only

an aspect of management and not the totality of

management



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The System Theory SchoolSystem: a collection of parts operating

interdependently to achieve a common

purpose.

General systems theory: an interdisciplinary

area of study based on

the assumption that everything is part of a larger,interdependent arrangement.



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The System Theory SchoolOpen System

A system that takes resources for its external

environment and converts them into goods and servicesthat are then sent back to that environment for purchase

by customers.

Inputs: the acquisition of external resources.

Conversion: the processing of inputs into goods andservices.

Output: the release of finished goods into the

environment.



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The System Theory School



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Rejects the universality thesis and emphasis that there is no

best way to manage.

Focuses on the inter-relationships within and among thesubsystems as well as between the organization and its

environment

Emphasizes the multivariate nature of organizations and

attempts to understand how organizations operate undervarying conditions and in specific situations

Regards management as situational

The Contingency Theory School

chapter 3= management thought

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