•The simple definition of

management is getting
things done through people.
•To ensures that their
assigned tasks are done
properly and efficiently,
these people have to be
managed.
Industrial Revolution
• Refers to transition from hand
production methods to the use of
different machines, new chemical
manufacturing processes, iron
production processes, increasing
use of steam power and
development of machine tools.
Evolution of
Management
Theories
•The driving force behind
the evolution of
management theory is
the search for better
ways to utilize
organizational resources.
•The evolution of modern
management began in
th
the 19 century after the
industrial revolution.
Categories of Theories
The Classical School of Thought
- Classical Organizational Theory
- Scientific Management
Behavioral Science School
- The Human Relations School
- Behavioral Science School
New Developments in Management
-Systems Theory
- Contingency Theory
 Core Ideas of Classical School
of Thought
• Application of science to the
practice of management
• Development of basic
management functions
• Evolved in response to the shift
from handicraft to industrial
production.
Scientific Management theory
• First management theory after the
industrial revolution
• Main objective was to scientifically
determine the best method of work in
order to improve productivity
• The systematic study of the
relationships between people and
tasks for the purpose of redesigning
the work process for higher efficiency.
Frederick Taylor
Father of Scientific Management
Believed that decisions based upon
tradition and rules of thumb should be
replaced by precise procedures developed
after a careful study of an individual at
work.
Taylor sought to reduce the time a worker
spent on each task by optimizing the way
the task was done.
Taylor’s Theory of Scientific
Management
 Scientific selection of workers to
increase productivity
Example: selecting workers whose skills
match the jobs to be performed.
 Training of workers
 Differential pay rate system / piece
rate pay system
Application of Taylor’s Theory of Scientific
Management in the Modern Workplace
• Assembly Line Plants as Prototypical Examples- work is
highly specialized
• System of Remuneration (quotas - commission) – payment
system according to performance
• Re-Design or Reengineering - Data is used to refine,
improve, change, modify, and eliminate organizational
processes
• Benchmarking – copying better methods of performance
from others
• Lean Manufacturing – producing at minimal costs
• Training of worker
Adam Smith’s - Job specialization
Adam Smith found firms manufactured pins in two ways:
Craft -- each worker did all steps.
Factory -- each worker specialized in one step.

Smith found that the factory method had much higher

productivity.
Each worker became very skilled at one specific task.

Advocated for breaking down the total job to allow division

of labor
For example: job specialization to increase productivity
through creation of experts (highly skilled workers)
The Gilbreths- Time and Motion
Studies
• Focused on ways of promoting the individual workers
welfare
• Using the motion Picture cameras, they tried to find out the
most economic motions for each task of the brick layer in
order to upgrade performance and reduce fatigue.
• The Gilbreths developed a 3 position plan intended to serve
as an employee development program
1st step – To do present job very well
2nd Step – Prepare for a higher position well
3rd Step – Train a successor
• They observed that workers should be doers, learners and
teachers.
Henry L. Gantt – The Gantt Chart
• He designed the Gantt chart .
For example: A project scheduling model for
increasing the efficiency of project execution and
completion.
• Criticized the differential pay system to be unfair
and advocated a bonus system.
For example: The supervisor should earn a bonus
for each worker who reached the daily standard and
extra bonus if all workers reached it.
• Advocated for training of workers to do a better
job.
Robert Owen
Known as Father of Personnel Management.
 Worked towards building cooperation between management
and workers.
Believed that workers should be treated as human beings.
He suggested that investment in human beings is more
profitable than investment in any physical resource.
Introduced new ideas of human relations
provision of better housing for workers
reduced working hours,
rest pauses,
training of workers,
education for workers’ children
Charles Babbage
• He was a British mathematics professor at
Cambridge university.
• Contributed to the introduction of scientific
methods to management through:
Advocating the principle of division of labor
(emphasized work specialization)
 work measurement
optimum utilization of machines
cost reduction
wage incentives
Classical Organizational Theory
Henry Fayol’s Administrative Theory

Henry Fayol is the Father of Modern Management, was a

French industrialist who developed a framework for
studying management.
Was first to identify the specific management functions:
1. Planning
2. Organizing
3. Leading
4. Controlling
Henry Fayol’s Administrative
Theory
• The management process can be
separated into departments.
• Fayol’s major functions of
management are recognized as the
main objectives of modern managers.
• The functional approach is useful
because it specifies what managers
should do.
MaxWeber - Theory of Bureaucracy
German Sociologist and the Father of Modern Sociology
Developed the concept of bureaucracy as a formal
system of organization and administration designed to
ensure efficiency and effectiveness.
Bureaucracy allows for the optimal form of authority -
“rational authority”
Three types of Legitimate Authority:

Traditional Authority - past customs; personal loyalty

Charismatic Authority - personal trust in character and
skills
Rational Authority - rational application of rules or laws
Application in the Modern Workplace

• Large organizations guided by countless rules and

regulations
• Existence of task relationships
• Presence of a clear hierarchy of authority in most
organizations
• Use of authority in many organizations to get things done.
• Presence of a vision (direction) in many organization
• Existence of separation of management and ownership in
many large organizations
• Centralization of power in the managers in many
organizations.
Core Concepts of Behavioral Science
School
• Developed in reaction to the Scientific Theory of
Management which emphasized standardization of jobs,
processes and technologies to maximize economic return.

Focus shifted to the human side of organizations.

• The best way to motivate, structure and support employees
- The study of how managers should behave to motivate
employees and encourage them to perform at high levels and
be committed to the achievement of organizational goals.
• The need for workers to find intrinsic value in their jobs.
• The positive impact of social relationships on worker
productivity.
Human Relations School
• Elton Mayo (1880–1949) was an
Australian psychologist, sociologist, went
to Harvard University.
• Spent most of his career at Harvard
Business School as Professor of Industrial
Research.
• Main focus was on the people working in
an organization
The Hawthorne Studies
• Worker productivity was measured at various
levels of light illumination.
• Researchers found that regardless of whether
the light levels were raised or lowered,
productivity rose.
The experiments were an attempt to put
Taylor’s ideas in practice.
Mayo decided that the traditional financial
incentives were not causing productivity
improvements.
The Hawthorne Studies
Productivity increases when workers believe
that they are being observed closely.
Employees perform better when managers
and co-workers make them feel valued.
Financial rewards are not necessarily
conducive to increasing worker productivity.
Workers care about self-fulfillment,
autonomy, empowerment, social status and
personal relationships with co-workers.
Core Concepts Behavioral Scientists
School
• The fulfillment of emotional needs of workers
is important in achieving economic goals.
• Employee satisfaction and working conditions
are important in achieving worker productivity.
• Workers are intrinsically motivated to work
when they feel a sense of belonging and
participate in decision making.
• Workers desire diverse and challenging work.
Douglas McGregor’s X and Y Theory

Theory X: best represented the

views of scientific management
Theory Y: represented the views of
human relations approach.
Douglas McGregor believed that
theory Y was the best philosophy for
all managers
General assumptions of employee
behavior and Managerial Behavior
• Theory X: the average worker is lazy, dislikes
work and will do as little as possible.
Managers must closely supervise and control
through reward and punishment.
• Theory Y: workers are not lazy, want to do a good
job and the job itself will determine if the worker
likes the work.
Managers should allow the worker great
latitude, and create an organization to stimulate
the worker.
The Systems Approach
• What Is a System?
• A collection of parts operating interdependently
to achieve a common purpose
• Systems Approach
Posits that the performance of the organization
as a whole is greater than the sum of the
performance of its parts.
Seeks to identify all parts of an organized
activity and how they interact.
Four Major Concepts underlying
the Systems Approach
• Specialization: a system is divided into smaller
components allowing more specialized concentration on
each component.
• Grouping: to avoid generating greater complexity with
increasing specialization, it becomes necessary to group
related disciplines or sub disciplines.
• Coordination: as components and subcomponents of a
system are grouped, it’s necessary to coordinate the
interactions among groups.
• Emergent properties: dividing a system into subsystems
(groups of component parts within the system)
Contingency Theory
• The environment impacts the organization
and managers must be flexible to react to
environmental changes.
• The way the organization is designed,
control systems selected, depend on the
environment.
• Different situations require different
managerial responses.
Theory Z - Japanese Management" Style

• William Ouchi
• Theory Z focused on increasing
employee loyalty to the company by
providing a job for life with a strong
focus on the well-being of the employee,
both on and off the job.
• Promotes stable employment, high
productivity, and high employee morale
and satisfaction.
Characteristics of Theory Z
Long-term employment
Collective responsibility
ollective decision-making
Slow evaluation and promotion
Moderately specialized careers
Concern for a total person, including
their family
New Trends in Management
• Reengineering,
• Total Quality Management
• MBWA
• MBO
• ROM
• McKinsey 7-approach