1. History of Management Thought
Chapter 2
History of Management Thought
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2. Historical Background
The development of capitalism and the Industrial Revolution were major cultural changes that preceded the evolution of modern management practice and thought.
These changes culminated in a period of industrial chaos and low productivity that gave rise to the definition and development of management as a critical factor of production.
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3. The Development of Management Theories
A management theory is a systematic statement, based on observations, of how the management process might best occur, given stated underlying principles.
The major perspectives from which to study management are:
The classical approach
The behavioral approach
The systems approach
The contingency approach
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5. The Classical Approach
The classical approach to management stresses the manager’s role in a formal hierarchy of authority and focuses on the task, machines, and systems needed to accomplish the task efficiently.
The classical approach to management thought has two components:
Scientific management
Administrative management
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7. Scientific Management
Scientific management’s overall emphasis was the systematic study of and experimentation with workers’ tasks, methods, and tools as a means of improving worker efficiency.
Frederick Taylor developed principles of scientific management:
Develop the “one best way” to perform any task.
Scientifically select, train, teach, and develop each worker.
Cooperate with workers and provide an incentive to ensure that the work is done according to the “one best way.”
Divide the work and the responsibility equally between management and the workers.
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8. Scientific Management (continued)
Taylor’s assumptions:
Employers and employees have mutual interests associated with economic gain.
Humans are rational beings and economically motivated.
For every person willing to work hard, there is a job for which he or she is ideally suited.
In addition to Taylor, other contributors to scientific management included Frank and Lillian Gilbreth, Henry Gantt, and Morris L. Cooke.
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9. Administrative Management
Administrative management emphasizes the universality of management as a function that can be applied to all organizations.
Henri Fayol defined management as a universal process composed of five functions and developed principles needed to coordinate all the activities of the entire organization.
Max Weber’s ideas about bureaucracy added the concept of rational authority and management by position to classical management theory.
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12. Contributions of the Classical Approach to Management Theory
Classical theories emphasized work and getting it done efficiently.
The main criticisms of the classical theories are that they focused too narrowly on work, machines, authority structures, and efficiency, and that they ignored the human aspect of work.
However, the basic purpose behind each classical theory was to improve the standard of living and quality of life for all members of the organization and society in general.
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13. The Behavioral Approach
The behavioral approach to management emphasizes the importance of human behavior, needs, and attitudes within organizations.
Mary Parker Follett had strong views on the importance of integrative unity, shared power, and human cooperation.
The Hawthorne studies brought to managers’ attention the critical nature of the social needs of workers and led to the development of the human-relations movement.
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14. The Behavioral Approach (continued)
Abraham Maslow proposed that humans have five needs:
Physiological
Safety
Social
Self-esteem
Self-actualization
Management practices directed toward satisfying self- actualization pointed to a new direction for management theory and practice.
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15. The Behavioral Approach (continued)
Douglas McGregor labeled and explained a nontraditional approach known as Theory Y, in contrast to the traditional approach of Theory X.
Sigmund Freud’s work on “transference” showed that awareness of transferences is an important skill with respect to effective management leadership.
Carl Jung’s work on personality types helped lead to the development of the Myers-Briggs Type Indicator.
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17. The Systems Approach
The systems approach to management theory views organizations and the environment within which they operate as sets of interrelated parts to be managed as a whole to achieve a common goal.
Chester Barnard believed that cooperative systems and the acceptance theory of authority helped organizations to adjust effectively to a constantly changing external environment.
W. Edwards Deming transformed the notion of quality into a driver of profits instead of a cost of doing business.
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18. The Contingency Approach
The contingency approach helped bridge the gap between theory and practice.
It emphasizes identifying the key variables in each management situation, understanding the relationships among these variables, and recognizing the complex system of cause and effects that exists in every managerial situation.
As such, the contingency approach maintains that there is no one best way to manage.
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19. Twenty-First Century Management
Peter Drucker’s predictions about the importance of knowledge workers, long-term sustainability, and corporate social responsibility have become important parts of management in the twenty-first century.
Peter Senge’s theory of learning organizations states that modern organizations must be in a state of constant learning through continuous improvement and adaptation.
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20. Management Theory: Past, Present, and Future
Each major approach to management theory has added significantly to current knowledge about management.
The ideas embedded in each approach have also changed, in some respects, the way managers think and act.
Contemporary managers and managers of the future benefit most from understanding and applying selected aspects of each approach.
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