Chapter 2 The Evolution of Management

Management 1e Learning Objectives  Describe the historical foundation of management  Explain the beginnings of modern management theory and education  Outline the progression of the quantitative approach to management  Outline the progression of the humanistic approach to management  Interpret the factors that led to a balanced approach to management - 2

Management 1e The Historical Foundations of Management (p. 32)  “Wealth of a Nation” – Adam Smith (p. 33) Division of labor – workers specialize on a task  Corporation Legal entity formed and structured to achieve goals with special protections for owners  Dartmouth College v. Woodward

Management 1e Discovering and Teaching Management Theory (p. 33)  Bureaucratic management – Max Weber (p. 34) Bureaucracy – an organization marked by:  Division of labor  Managerial hierarchy  Formal selection  Career orientation  Formal rules and controls  Impersonality

Management 1e Discovering and Teaching Management Theory (cont.)  Administrative management – Henri Fayol (p. 35) Administrative theory  Identifies the functions of management  Successful management linked to satisfied and motivated employees  “Art of management”  Management principles must be adapted to every need  Provided the basis for management education  Principles of management

Management 1e The Quantitative Approach (p. 37)  Soldiering Workers tested management by performing as slowly as possible, while creating the impression that they were working fast  Natural soldiering  Systemic soldiering  Quantitative approach Applying objective methods to enhance decision making  Management science Using statistics, mathematics, and other quantitative methods to improve efficiencies

Management 1e The Quantitative Approach (cont.)  Scientific management – Frederick Taylor (p. 37) Classical perspective – make organizations and workers operate as efficiently as possible Used quantitative approach to analyze and synthesize the flow of work to maximize productivity Task-management system – combination of setting performance standards, selecting the best worker for the job, and building good relations between managers and employees (p. 38)  Harrington Emerson – principles of efficiency  Blueprint for the art and science of management

Management 1e The Quantitative Approach (cont.)  Motion studies – Frank B. Gilbreth (p. 39) Motion picture cameras captured the step-by-step movements taken to complete a task Sought efficiencies by orchestrating the maximum results for the least worker effort  Scientific management and the mind – Lillian Gilbreth (p. 40) Studied how managerial perceptions, emotions, and thoughts affected work and employees Three historical types of management  Traditional  Transitory  Scientific

Management 1e The Quantitative Approach (cont.)  Visualizing management – Henry Gantt (p. 40) Habits of industry  Training converted invisible internal forces into visible behaviors such as industriousness and cooperation Developed methods for visualizing performance standards  Importance of time  Gantt progress chart Figure 2.1

Management 1e The Quantitative Approach (cont.)  Quality movement (p. 42) Ford Motor Company  Assembly line – parts added sequentially to manufacture a product more quickly  Interchangeable parts Operations research – established a quantitative rationale for decisions that lead to goal attainment Edwards Deming  Continuous improvement (p. 43)  Quality circles  Lean manufacturing  Total quality management  Six sigma

Management 1e The Humanistic Approach (p. 43)  Focused on the human side of management  Hawthorne studies (p. 44) Employees motivated by more than money Group dynamics have an impact on worker morale and performance  Illumination study – performance increased when lighting increased or decreased  Relay assembly test room – productivity increased following various changes in work conditions  Interviewing program – non-directive interviewing (p. 45) Managers encouraged to treat workers as people and to approach groups informally, thereby increasing productivity

Management 1e The Humanistic Approach (cont.)  Conflict: Mary Parker Follett (p. 45) Constructive conflict – positive outcomes from group conflict emerge when individual ideals remain intact and become part of a “single whole” (p. 46) Figure 2.2

Management 1e The Humanistic Approach (cont.)  Conflict: Mary Parker Follett (cont.) “Power with people,” not “power over people” (p. 47)  Motivation: Douglas McGregor Theory X – negative assumptions about worker motivation  People do not like work; must be coerced or intimidated Theory Y – positive view about worker motivation  People enjoy the mental and physical purpose of work; try to expand their personal contributions Behavioral management – relies on understanding individual behaviors, decisions, and attitudes to motivate employees

Management 1e The Balanced Approach (p. 48)  Contingency (situational) theory Different organizations, situations, and contexts require different approaches  Cooperation: Chester I. Barnard (p. 49) Entropy – inefficient organizations lose social and market-based energy leading to the decline of the system Negative entropy – social and market-based energy that builds or maintains a system Managers must maintain an equilibrium of internal and external forces and their relationship to the organization  Cooperative system – managers of effective and efficient organizations control and influence people’s behavior by modifying their motives

Management 1e The Balanced Approach (cont.)  Systems: Jay W. Forrester (p. 49) System dynamics – enable managers to achieve “equilibrium” and stability in their organizations von Bertalanffy – general systems theory  Organizations are open systems  Have the power to change and be changed by external and internal forces  Organizational whole comprised of interdependent subsystems

Management 1e Copyright Copyright © 2014 John Wiley & Sons, Inc. All rights reserved. Reproduction or translation of this work beyond that permitted in Section 117 of the 1976 United States Copyright Act without express permission of the copyright owner is unlawful. Request for further information should be addressed to the Permissions Department, John Wiley & Sons, Inc. The purchaser may make back-up copies for his/her own use only and not for distribution or resale. The Publisher assumes no responsibility for errors, omissions, or damages, caused by the use of these programs or from the use of the information herein.