To under stand the Evolution of Management Thought

The growth of modern management techniques began with industrial revolution in England during the 18th & 19th centuries. A series of inventions were made by the scientists like Hargreaves, Arkwright, Crompton, Kay, and Catwright. The important inventions include Spinning jenny, Water frame, Mule, Power loam and Machine lathe, which completely revolutionized the commerce and industry. The life of Management is as old as civilizations. The above development led to the emergence of different theory of management.

The divergent directions of Management thought have caused Management writers, like Harold Koontz to call the resulting array the management theory jungle.
One can study the evolution of management by dividing the theories of management into three stages.

I.
II. III.

The Classical Theory of Management.

The Neo Classical Theory. The Modern Management Theories

These theories of management were the very early theories which lost its importance with the passage of time. These theories have become a failure in these days. Main contributions of Classical theory were: i. Bureaucratic Model by Max Webber in 1900.

ii. Scientific Management by F.W.Taylor in 1910. iii. Functional or Administration Management by Henry Fayol in 1910.

Bureaucratic theory is based on rigours rules and regulation without scope for innovation. He provided the classical theory of organization and management. He felt that in classical theory of organization and management, bureaucracy was the most efficient form for complex organization. Following are the Bureaucracy models main features : i. Rules and Regulations

ii. Hierarchy of Authority iii. Technical Competence iv. Division of work

v. Record Keeping
vi. Impersonal Relations

i.

Specialization

ii. Structure iii. Rationally iv. Predictability v. Democracy

i.

Impersonality

ii. Goal Displacement iii. Rigidity iv. Unnecessary paperwork v. Empire Building vi. Compartmentalization of activities

Fredrick Winslow Taylor was the father of scientific management . Features of Scientific Management

i.

Time study

ii. Motion study iii. Scientific task planning iv. Standardization and simplification v. Financial Incentives for motivating employees vi. Functional foremanship vii. Economy in operations.

i.

Scientific management, it reduces the workers merely to a machine.

ii. It makes their work monotonous. iii. It leads to retrenchment of workers. iv. Scientific management leads to unemployment as machines start replacing manpower. v. It leads to mental &physical strain on workers by undue speeding them up. vi. It adversely affects the initiative, motivation and the morale of workers.

Fayols contribution are generally termed as Operational Management of Administrative Management . Fayol looked at the problems of managing an organization with the management point of view. Functions of the Manager as per Fayol i. Division of work

ii. Authority & Responsibility iii. Discipline iv. Unity of command v. Unity of Direction

vi. Subordination of individual to general interest .

vii. Remuneration of personnel viii.Centralization

ix. Scalar Chain x. Order xi. Equity

xii. Stability
xiii.Initiative xiv.Esprit de corps

The contributors of the Neo classical theory had a human approach. Their approach highlighted the findings of Hawthorne experiment done in Western Electric Company between 1927 to 1932 by a team of researchers from Harvard University. Elton Mayo, a Harvard sociologist and the director of Hawthorne studies, is regarded as the father of the Human Relations School. The basic objective of Hawthorne study was to examine the effect of fatigue of workers but this was extended to evaluate attitude and psychological reactions of the workers on the job. He dealt with the factors that cause the increase in the productivity of the workers is not a single factor like that of changing working hours of work and the working conditions but a combination of these and several other factors such as:

i.

Less restrictive methods of supervision

ii. Giving autonomy to the workers iii. Allowing the formation of small cohesive sub-groups of the workers iv. Creating conditions which encourage and support and the growth of these groups v. Co operation between management & worker

The team of Elton Mayo was of this firm opinion

Workers are not like machinery The morale of the employees as an individual or as a member of a working group has got a direct impact on the productivity of an enterprise Managers should believe in employees oriented approach The employees should understand group attitude (their psychology)

This theory is regarded as a further refinement of the Human Relation Movement. Its coverage is interpersonal roles and relationship has got a high significance. Basically this approach has given emphasis on the following important aspectsi. Employees Motivation

ii. Efficient &human based leadership iii. Multi- directional communication iv. Employee personality development in totality

v. To regard organization as an social system

Since 1950 researchers began to look at organizations from a systems view point. Many researchers made significant contributions to the development of the systems approach.

The main elements of systems approach are as follows:

i. An organization is a unified and purposeful system consisting of several interconnected, interacting and interdependent parts.

ii. The parts or components of a system are called sub-systems. Each subsystem influences the other subsystems and the system as the whole. Different subsystems are tied together into an organic whole through goals, authority flows, resource flows and information flows. iii. The position and function of each system can be analyzed and under- stood only in the relation to the other subsystems and to the organization as a whole. Similarly , the organization as a system can be analyzed and understood only by reference to its sub- systems.

iv. Each sub-systems derives its strength by its association and interaction with the other subsystems. As a result the collective contribution of the organization is greater than the aggregate of individual contributions of its subsystems. This is known as synergy. v. Every system has a boundary that separates it from its environment. The boundary determines which parts are internal to the organization and which are external. For example, employees are within the boundary whereas creditors and customers are external to a business firm. vi. Systems are of two types. An open system continually interacts with its environment( the forces lying outside it ) whereas a closed system is self contained and isolated from the environment. vii. A business enterprise is an open and dynamic system. It draws inputs (raw materials, machinery, labour, finance, information etc). from its environment . It converts these inputs into outputs (products and services etc.) with the help of conversion process. viii. The reaction or response of the environment to the outputs is known as feedback.

Systems approach provides a refreshingly new thinking on organizations and their management. It calls attention to the dynamic and interrelated nature of business organizations. It provides a strong conceptual framework for a meaningful analysis and understanding of organizations and their management. Systems approach provides clues to the complex behavior of people in an organization .It has become an integral part of management thought and practice. The systems approach is often criticized as being too abstract and vague. It cannot directly and easily be applied to practical problems. It fails to specify the nature of interaction and interdependencies particularly between an organization and its external environment. It fails to offer a unified body of knowledge.

The contingency approach is a relatively new approach to organization and management. It is related to the systems approach. The belief that organizations are open systems widened the perspective further leading to the development of the contingency approach. It is also known as the situational approach. The basic theme of the contingency approach is that there is no single best way of managing applicable in all situations. The best solutions is the one that is responsive to the peculiarities of the given situation. Therefore, management should deal with different situations in different ways. Contingency approach rejects universality of management concept. Use of contingency approach is not possible without the ability to match the management knowledge and skills to the demands of the given situation.

The main features of the contingency theory are as follows: i. Management is entirely situational. In other words, the conditions and complexity of the situation determine which measure or technique is applicable and effective.

ii. Management should, therefore, match or fit its approach to the requirements of the particular situation. To be effective , management policies and practices must respond to environmental changes. The organization structure , the leadership style, the control system all should be designed to fit the particular situation.
iii. Since managements success depends on its ability to cope with its environment, it should sharpen its diagnostic skills so as to anticipate and comprehend the environmental changes. iv. Managers should understand that there is no one best way to manage. They must not consider management principles and techniques universal.

Contingency approach provides a clear view of the realities of the managerial job. The contingency approach avoids this organic stand and suggests specific solutions. It widens the horizons of managers from the concepts , principles and techniques of management theory. It promotes analytical, critical and multi-dimensional thinking with the help of which managers can innovate new and better approaches and widen their choice. The contingency approach does not suggest that the findings of earlier approaches are useless. Rather it attempts to integrate them and make them contingent upon the demands of the situation. The contingency approach is not free from criticism. Critics argue that it adds confusion to the practice of management by stressing that it all depends on the situation. Critics also point out that without a theoretical foundation; it is almost impossible to research, to gain valuable information, or develop a knowledge base .It is also said that there is nothing new in contingency theory because even classical theorists like Fayol cautioned managers to use principles in the light of changing conditions.