Historical Foundations of Management

Understand how historical forces influence the practice of management. Identify and explain major developments in the history of management thought.

Why is history important?

It gives executives a way of thinking, a way of searching for patterns and understanding trends. It provides a context or environment in which to interpret current problems.

Forces: Social, political, economic

Management Approaches
Classical Humanistic Management Science Recent Trends
Systems Theory Contingency View Total Quality Management

First Perspective: Classical

Classical Perspective
Emerged during the 19th and 20th centuries Factory systems appearing in 1800s Problems:
Tooling the plants Organizing managerial structure Training employees (many immigrants) Scheduling complex manufacturing operations Increased labor dissatisfaction; strikes

Classical Approaches
Scientific Management
Frederick Winslow Taylor (1856-1915) Henry Gantt Frank B. and Lillian M. Gilbreth

Bureaucratic Organizations
Max Weber (1864-1920)

Administrative Principles
Henri Fayol (1841-1925) Mary Parker Follett (1868 1933) Chester I. Barnard (1886-1961)

Scientific Management

Classical Perspective

Frederick Taylor, Engineer Father of Scientific Management

Problem in labor productivity lies with poor management practices, not labor. Manner of change can be determined only by scientific study. Replace rules of thumb and tradition with precise procedures developed after careful study. Work with Bethlehem Steel plant in 1898

Henry Gantt
Gantt Chart a bar graph that measures planned and completed work along each stage of production by time elapsed.

Frank B. Gilbreth (1868 1924)

Pioneered time and motion study Stressed efficiency; one best way to do work. Early work with bricklayers Greatest impact on medical surgery by drastically reducing the time patients spent on the operating table.

Lillian M. Gilbreth 1878-1972

Widowed in 1924 with 12 children, ages 2 19. First Lady of Management Pioneered in the field of industrial psychology and made substantial contributions to human resource management.

Bureaucratic Organizations

Classical Perspective

Max Weber, German Theorist

Envisioned organizations managed on an impersonal, rational basis. An organization based on rational authority would be more efficient and adaptable to change. Employee selection and advancement based on competence. Rely on rules and written records for continuity. Manager relies on legal power of his/her position instead of personality.

Elements of a Bureaucracy
Labor is divided with clear definitions of authority and responsibility. Positions are organized in a hierarchy of authority. All personnel are selected and promoted based on technical qualifications, which are assessed by examination. Administrative acts and decisions are recorded in writing. Management is separate from the ownership of the organization. Managers are subject to rules and procedures. Rules are impersonal and uniformly applied.

Administrative Principles

Classical Perspective

Henri Fayol, French Engineer

General and Industrial Management Proposed 14 general principles of management
Unity of command (one supervisor) Division of work (specialization) Unity of direction (group similar activities) Scalar chain (chain of authority)

Mary Parker Follett

Trained in philosophy and political science Stressed the importance of people rather than engineering techniques Dont Hug Your Blueprints Analyzed dynamics of managementorganization interactions Addressed ethics, power and leadership Proposed concept of empowerment

Chester I. Barnard
Studied Economics at Harvard; no degree President of New Jersey Bell in 1927 Proposed the concept of the informal organization Includes cliques and naturally occurring social groupings Acceptance theory of authority people have free will and can choose whether to follow management orders.

Second Perspective: Humanistic

Humanistic Perspective
Human Relations Movement
Hawthorne Studies (1927-1932), Western Electric Hawthorne Works in Chicago CIL, Thomas Edison, Honorary Chair, 1924-1927 Elton Mayo, Harvard Business School examined productivity and work conditions

Human Resources Perspective

Abraham Maslow (1908-1970) Douglas McGregor (1906-1964)

Behavioral Sciences Approach

The Hawthorne Effect

The rewards you reap when you pay attention to people. The mere act of showing people that youre concerned about them usually spurs them to better job performance. When people spend a large portion of their time at work, they must have a sense of belonging, of being part of a team.

Hawthorne Studies
1895 struggle develops between manufacturers of gas and electric lighting fixtures for control of the residential and industrial market. More light results in more productivity, they say RATR 6 year Study Result: Money was not the cause of the increased output. Employees output increased sharply when managers treated them in a positive manner. Started a revolution in worker treatment for improving organizational productivity.

The Human Relations Movement

Humanistic Perspective
The human relations school of thought considers that truly effective control comes from within the individual workers rather than from strict, authoritarian control.

The Human Resources Perspective

Humanistic Perspective

Abraham Maslow, Psychologist

Observed that patients problems stemmed from inability to satisfy their needs. Proposed a hierarchy of needs
Physiological needs Safety Belongingness Esteem Self-actualization

Basis for motivational techniques

Douglas McGregor, College President

Challenged assumptions about human behavior based on his experiences as a manager, consultant, his training as a psychologist, and Maslows work. Theory X and Theory Y Workers are best described by Theory Y Take advantage of the imagination and intellect of all employees.

Behavioral Sciences Approach

Humanistic Perspective

Behavioral Sciences Approach

Develops theories about human behavior based on scientific methods and study. Draws from sociology, psychology, anthropology, economics and other disciplines to understand employee behavior and interaction in an organizational setting. Impacts motivation, communication, leadership and human resource management.

Third Perspective: Mgt Science

Management Science Perspective

World War II created sophisticated tools for modern global warfare. Applies mathematics, statistics and other quantitative techniques to management decisionmaking and problem-solving. Operations Research Operations Management Management Information Systems Queuing Theory

Fourth Perspective: Emerging Trends

Systems Theory Contingency View Total Quality Management (Deming)

Systems Theory
A set of interrelated parts that function as a whole to achieve a common purpose.
Inputs Transformation process Outputs Feedback Environment

Contingency View
Universalist View (classical perspective) management concepts are universal Case View Each situation is unique. Contingency View A managers response depends on identifying key variables in an organizational situation. What works in one setting may not work in another. Contingencies include the environment, industry, technology and international cultures.

Total Quality Management

Shift from inspection approach to quality control to an approach emphasizing employee involvement in the prevention of quality problems. Managing the total organization to deliver quality to customers. Significant Elements of TQM
Employee involvement Focus on the customer Benchmarking Continuous improvement

Dr. W. Edwards Deming (1900-1993) Father of Quality Movement

Developed theory and methods to improve the quality an dependability of manufactured products. Out of the Crisis, 14 points Application of his work in Japan sparked the Japanese Industrial Miracle-the transformation of Japanese business www.deming.org/deminghtml/wedi.html