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

2. Scientific Management in Retrospect CHAPTER TWELVE

3. Scientific Management in Retrospect  The Economic Environment  Technology  The Social Environment  The Political Environment

4. The Economic Environment  The United States was in transition from an agrarian to an industrial nation. In this period of growth, scientific management provided a means whereby a better utilization of resources could occur.  The U.S. worker prospered, both in real wages and reduced hours of work.  More employees were in management with the addition of staff specialists. This growth in managerial hierarchy made it more critical to plan, organize, etc.

5. The Economic Environment  Alfred Chandler’s rationalization of resource utilization describes the needs of industry during this era. The ideas of the scientific management pioneers fit these needs. Alfred Chandler’s  Industrial efficiency was increasing, partially due to scientific management. Alfred D. Chandler Alfred D. Chandler Courtesy of Harvard Business School

6. The Economic Environment  America was uniquely diverse 1890-1920:  Immigrants were 80% of New York’s population.  More Irish lived in the US than in Ireland.  71% of Ford’s labor force was foreign born.  Developing systems and procedures and standardization was more important with the heterogeneous workforce.  Productivity increased due to:  Methods of mass production.  Taylorism (Scientific Management)  Cheaper sources of power The 1909 Model T.

7. Technology: Opening New Horizons  Enterprises developed and grew – 247 of the Fortune 500 were founded from 1880- 1929.  New technologies developed:  Bessemer process in steel  Oil refining  Internal combustion engine  Synthetic material  Telephony  Electric energy Bessemer process in steel

8. Technology: Opening New Horizons  The automobile changed people’s lives and created a new industry.  Henry Ford, Charles Sorenson and their associates at Ford created the moving assembly line for mass production. Henry Ford  1910 – 2,773 workers produced 18,664 cars  1914 – 12,880 workers produced 248,307 cars Henry Ford

9. The Social Environment

10.  Horatio Alger, Jr. characterized the “success” ethic of U.S. enterprise.  Scientific management ideas were consonant with the social values of self-directing, high need for achievement, individuals  Change came as the Western frontier closed; William G. Scott called this the Collision Effect, which would lead to a transition period of individualism being replaced by a social ethic.  Taylor’s “cooperation, not individualism” bridged the gap between the social and individualistic ethics.

11. The Social Environment  The Social Gospel shaped personnel management acting as a counterpoint to social Darwinism and precursor to progressivism.  Followers of the Social Gospel, like Robert G. Valentine, thought unions were instruments of social and economic reform.  A reciprocal work-welfare equation linked the progressives and scientific management.  Efficiency was also advocated by conservationists, feminists, and religious leaders.

12. The Political Environment  The political articulation of the Social Gospel was the Populist-Progressive Movement.  Scientific management appealed to the Progressives, especially Morris Cooke.  Scientific management offered leadership by expertise and knowledge, not class, so it appealed to moderate Progressives like Louis Brandeis, Herbert Croly, and Walter Lippman. Lewis Hine (1915)

13. The Political Environment  An increasing regulation of business under Theodore Roosevelt after 1901 overcame the inadequacies of the earlier Sherman Act.Theodore Roosevelt  Tax rate comparison – Underwood-Simmons Tariff Act of 1913.  1% on personal incomes over $3,000  Surtax added progressively on incomes up to $20,000  Maximum tax rate of 7% on incomes in excess of $500,000 (compared to 35% today) Theodore Roosevelt, courtesy of the Constitution Society

15. Summary of Part Two  Taylor was the focus for a deeper philosophy of managing human and physical resources in a more technologically advanced world.  Taylor’s disciples improved productivity and service to society.  Fayol and Weber, Taylor’s contemporaries, also reflected a rational approach to enterprise.  Taylor and his followers were affected by and did affect the times.

16. Part Two Internet Resources  Academy of Management – Management History Division Website http://www.aomhistory.baker.edu/departments/leadership/mgthistory/links.html http://www.aomhistory.baker.edu/departments/leadership/mgthistory/links.html  List of Internet Resources compiled by Charles Booth http://www.jiscmail.ac.uk/files/MANAGEMENT-HISTORY/links.htm http://www.jiscmail.ac.uk/files/MANAGEMENT-HISTORY/links.htm  Western Libraries Business Library – Biographies of Gurus http://www.lib.uwo.ca/business/gurus.html  Frederick Winslow Taylor http://www.accel-team.com/scientific/scientific_02.html http://www.accel-team.com/scientific/scientific_02.html  Fascinating Facts about Frederick Winslow Taylor http://www.ideafinder.com/history/inventors/taylor.htm  Who Made America – Frederick Winslow Taylor http://www.pbs.org/wgbh/theymadeamerica/whomade/taylor_lo.html  Films of Westinghouse Works – 1904 http://memory.loc.gov/ammem/papr/west/westhome.html

17. END OF PART TWO