1. THE EVOLUTION OF MANAGEMENT THOUGHT, 6 TH EDITION Electronic Resource by: Regina Greenwood and Julia Teahen

2. The Social Person Era in Retrospect Chapter Eighteen

3. The Social Person Era  The Economic Environment  The New Technologies  The Social Environment  The Political Environment http://www.bigfoto.com/

4. The Economic Environment  The 1920s were a period of prosperity, rising real wages, and low unemployment.  The unemployment rate in 1929 was 3 percent.  Although the stock market crashed in 1929, the impact on employment came more slowly and the peak was not reached in 1933.  “Darby corrected” data was used to gauge how federal and state unemployment relief programs reduced the reported number of unemployed by about 5 percent.

5. Stock Market Crash – 1929 President Hoover proposed work sharing rather than lay-offs, and this seemed to work for awhile. Employee stock ownership plans were double- edged swords; prosperity for the 1920s, but tragedy in the 1930s. Herbert Hoover signing the agricultural relief bill, June 15, 1929 Hebert Hoover Library: http://www.presidentialtimeline.org/html/record.php?id=32

6. Attitudes toward women working outside the home changed as two wage earner families became more important Stock Market Crash http://creativecommons.org/licenses/by-sa/2.0/

7. Stock Market Crash  Will Rogers’ made an observation that the automobiles bought during the prosperous 1920s were used to look for work in the 1930s.  Keynesian economics ran counter to the Protestant ethic notion of thrift.

8. The New Technologies  Joseph Schumpeter’s (1883-1950) ideas about innovation and economic development are noteworthy. Joseph Schumpeter’s  Economic development came from innovation.  “Creative Destruction”Creative Destruction  He favored supply side economics, not the Keynesian approach. Joseph Schumpeter

9. The New Technologies  Transportation, communication, and entertainment progress was apparent in automobiles, aircraft, radio, television, etc.  Developments in main frame computers, dry copying, polio vaccine, antibiotics, DNA, etc.  Public sector projects led to atomic energy; dam, road, and bridge building; the Tennessee Valley Authority, etc. Spirit pf St. Louis and Charles Lindberg, 1901 http://images.google.com/hosted/life

10. The Social Environment  The Lynds’ study of “Middletown” found workers of the 1920s were guided by economic motives. This supports, on a limited basis, the pros and cons of incentives during the Hawthorne studies.Lynds’ Robert and Helen Lynd http://speccoll.library.kent.edu/labor/R&HLynd.html

11. The Social Environment  Social values were in transition, shifting from the Protestant work ethic to a social ethic.  More collective action and turning to groups for security – consistent with an emphasis in management thought during this time on social needs

12. David C. McClelland (1917-1998)  David McClelland found a decline in the need for achievement and the rise of a need for affiliation.

13. David Riesman  Riesman noted the shift from the inner-directed to the other-directed person. Riesman  Inner-directed – represented the era of laissez-faire capitalism, the Protestant Ethic, and emphasized self- direction and control.  Other-directed – characterized by high social mobility and by emphasis on consumption rater than production and on getting along and being accepted by others as the key to accomplishment.  Shift from the “invisible hand to glad hand” – shift from individualism to collectivism.

14. The Social Environment  Dale Carnegie – “getting along” solution of How to Win Friends and Influence People. Dale Carnegie  William G. Scott’s use of fictional literature to show the shift in social values toward more emphasis on the group and the social person.

15. The Political Environment  The New Deal of F. D. Roosevelt promised to reshuffle society’s cards to benefit the “little people.”  This brought an abundance of legislation.

16. Legislation  Fair Labor Standards Act (1938) established a minimum wage of 25 cents per hour and a maximum 44 hour work week, with time and a half pay for hours over that, for covered workers.  The Railroad Unemployment Insurance Act (1938)  Federal Anti-Injunction Act, known more commonly as the Norris-LaGuardia Act (1932, pre FDR) http://www.dol.gov/oasam/library/special/child/sewing2.jpg

17. The National Labor Relations Act (1935)  The NLRA is the most important piece of legislation for labor in U.S. HistoryNLRA  Guaranteed the right to bargain collectively  Guaranteed the right of self-organization. This would lead to the downfall of employee representation plans  Specified unfair practices of management  Established the National Labor Relations Board.

18. The Wagner Act  Also a critical turning point for unions…  A new union, the CIO, was formed for industrial workers and enjoyed instant success.  Work stoppages increased from 1935- 1939 and were caused primarily by the desire to organize a union. Workers Cheer End of Flint Sit Down Strike http://www.uaw.org/solidarity/03/0103/pics/fea08.jpg

19. Summary of Part Three  Figure 18-1 depicts the Social Person Era.  Mary Parker Follett bridged the Scientific Management era with the emerging group.  The Hawthorne Studies brought the human relations movement to the forefront.  Increased concern for people  Calls for less rigid organizational structures  View that financial motives are only one part  Concern for emotion as well as efficiency  The human relations movement reflected the cultural environment.

20. Summary of Part Three  Two approaches to post-Hawthorne research:  Micro researchers studied people in groups.  Macro researchers viewed leadership as a group interactive- situational phenomenon, leading to organizational behavior and organization theory.  Descendants of Scientific Management, like Mooney, Reiley, Davis, and Barnard, addressed new organizational issues.  The culture of the period, shaped by economic stress, led to a decline in the Protestant ethic and more focus on people, not production.

22. END OF PART THREE