Development of Management Thought

Ms. Amanpreet Kaur

Michelangelo…

The lonely genius trapped between agony and ecstacy, isolated on his back on a scaffold, single handedly painting the ceiling of Sistine Chapel –

A Myth….!!!!!

Reality…• Some 480 yrs ago, was running a mid-sized firm.

• 13 people helped him paint, 20 in carving and 200 helped in building the library.

• He used to personally select, train, and assign them teams.

• Kept a detailed employment records of names, days worked and wages of every employee, every week.

• He was just a trouble-shooting manager with us even before Industrial revolution.

Industrial Revolution..??

• The advent of machine power, mass production and efficient transportation begun in the late 18th century in Great Britain.

Classical Approach

The term is used to describe the hypotheses of the scientific management theorists and the general administrative theorists.Inter-related functionsBased on experience of managersBased on basic truths and factsManagers were developed by formal education and trainingPeople are motivated by incentives and penalities.No conflict within individuals, if any, interest of orgn prevails

A) Bureaucracy Max Weber (1864-1920) A German Social Scientist

Principleso Division of worko Rules and Regulationso Hierarchy of Authorityo Technical Competenceo Record Keepingo Impersonal Relations

Legitimate Authority

Charismatic

Rational

Traditional

+ves & -ves

Positives Negatives

Specialisation Rigid

Structure Goal Displacement

Rationality Impersonalisation

Predictability Paper Work

Democracy Empire Building

Red Tape

B) Scientific ManagementFredrick Winslow Taylor (1856-1915)Father of Scientific Management

o Grew out to increase productivityo In 20th century, skilled labour in US were short in supply, so

neccessary to increase efficiency.

Objectiveso Provide scientific basis for designing and performing jobs.

o Managers to follow scientific and systematic approach to managerial problems in place of rule of thumb

Principles1. Science – No rule of thumb.2. Harmony, not discord.3. Co-operation not Individualism.4. Maximum output not restricted.5. Development of each man to his best capacity and ability.6. Maximum prosperity of employees, coupled with

maximum prosperity of Orgn.

‘Mental Revolution’Eyes off division of surplus, rather focus on increasing the size of

surplus

Techniques..

•Time Study (work Measurement)•Motion Study•Method Study•Fatigue Study•Differential wage rate system•Scientific task planning•Standardization + Simplification•Functional Foremanship

8 Supervisors

4 Planning in office

Route Clerk

Time & Cost Clerk

Instruction Card Clerk

Disiplinarians

4 Executing at Shop Floor

Gang Boss

Speed Boss

Repair Boss

Inspector

C) Administrative TheoryHenry Fayol (1841-1925)Father of Adminstrative Management

His Contributions…o 6 Business Activitieso 5 Management Functionso 14 PrinciplesBusiness Activities1. Technical2. Commercial3. Financial Operating activities of business4. Accounting 5. Security6. Managerial Activity Most Neglected

14 Principles1.Division of Work2.Authority and Responsibilty3.Discipline4.Unity of Command5.Unity of Direction6.Subordiantion of Individual interest to general interest7.Remuneration of personnel8.Centralisation9.Scalar Chain10.Order (Material order + Social order)11.Equity12.Stability of tenure13.Initiative14.Espirit de corps (Unity of efforts through harmony of interests)

Neo-Classical Approach

• A classical approach led to efficient orgn, but failed to recognize the overwhelming role of people in management.

• People began to resist formal and impersonal treatment.• The resistance and the need to secure willing co-operation

of workers led to the development of neo-classical approach.

Hawthrone Experiments Human Relations Movement Behavioural Sciences Thinking

Experiments conducted at a plant at Western Electric Company. Illumination Experiment Relay Assembly Test room studies Mass Interview Bank wiring observation room study

Conclusion-1. A work group- not a techno economic unit but a social system2. Workers not only rational economic beings motivated by money, but

also respond to work conditions3. Social+Psychological factors exercise greater control on employee

behaviour.

A) Hawthrone ExperimentsGeorge Elton Mayo (1880-1949)Father of Neo-Classical Approach

B) Human Relations Approach

Pertains to motivating people in orgn to develop team work which effectively fulfills their needs and leads to achieving organisational goals.

Contributions-1. Moral Justification2. Satisfy social and psychological needs to increase

productivity.3. Highlights the people side of orgn.4. A true concern for workers5. Focuses attention on inter-personal relations + Dynamics6. Stressed on training of people management skills and

managerial styles.

C) Behavioural Science ApproachBelief that human is more complex than the ‘economic man’

description of classical approach and the ‘Social man’ description of the Human relations approach.

Concentrates on the nature of work itself and degree to which it can fulfill the human need to use skills and abilities.

Contibutions-More use of teams to accomplish goals, focus on training and development and the use of innovative reward and incentive systems.

Systems Approach• Attempts to explain organisational behaviour by

analysing the structure of orgn.• It was a result of those orgns that were trying to

adapt to the rapid change in business environment.Features-1. Unified and purposeful system2. Each inter-related parts and subsystems.3. Each system has a boundary- Internal or External4. Open system Vs. Closed systems5. A business enterprise as a open system

(Draws Inputs- convert into output- sends to environment)

3. Throughput

1. Environment

4. Output

5. Feedback

2. Input

Contigency Approach

• Was developed by managers, consultants and researcher who tried to apply the concept of earlier approaches to real life situations.

‘ There is no best way to tackle the problem of management. The application of management principles and practices is contingent upon the

environment’

Environment Managerial Concepts

Principles + Techniques

Best solution is one which is responsive to the pecularities of a given situation.

Features1. Mgt is situational.2. Should match or fit its approach to the requirements of a

particular situation.3. Mgt’s success depends on its ability to cope with its env, it

should sharpen its diagonistic skills so as to anticipate and comprehend the environmental change.

4. Mgrs should understand that there is no best way to manage.

4 Sequential Steps

1.Analyze and understand the situation2.Study and examine the validity of various concepts, principles and techniques to situation.3.Make the right choice by matching the technique to the situation.4.Implement the choice.

Practical Utility of Approach

• Clear view of the realities of managerial job.• Suggests situation specific solutions.• Common sense value and widens practical utility• Integrate classical approach + apply contingent to

situation• Organisations environment are dynamic to be

always effectively managed in the same manner.• No golden rule – Applicable in all situations.

Negatives..• Confusion

• No theoritical foundation

• Does not incorporate all aspects of systems theory

• Reactive strategy rather than proactive theory.

Queries… ???

Ms. Amanpreet Kaur