Chapter Two

Evolution of Management (Theories)

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 Chapter outline

• Rationale of Studying Management Thought

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 Evolvement of Theories in Management

1. Pre classical theory of management

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Major Theories
Classical Management Approaches
 Scientific management
 Administrative principles
 Bureaucratic organization
Behavioral Management Approaches
 Follett’s organizations as communities
 The Hawthorne studies
 Maslow’s theory of human needs
 McGregor’s Theory X and Theory Y

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Major Theories
3. Modern Management Foundations
 Quantitative analysis and tools
 Organization as systems
 Contingency thinking
 Quality management
 Knowledge management and organizational learning
 Evidence-based management

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 Major Schools of Thought
 Classical -A focus on developing universal principles for use in
various management situations.
 Human Resource- A focus on human needs, the work group, and
the role of social factors in the workplace.
 Quantitative or Management Science: A focus on the use of
mathematical techniques for management problem-solving.
 Modern Approach: A focus on total systems and contingency
thinking, and an awareness of global developments in management.
 Continuing Directions: Emphasis on quality and performance
excellence, global awareness, and leadership roles for a new
management.
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1. Pre-classical management era
Early Influences: Ancient Records
• The history of the Roman Empire can be divided into three
distinct periods: The Period of Kings (625-510 BC),
Republican Rome (510-31 BC)(standardized code of laws
meant for public, private, and political matters and Imperial
Rome (31 BC – AD 476).
• The Romans effectively used many basic management
ideas, e.g. scalar principle(There should be a clear definition
of authority in the organization) & delegation of authority.
.

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Cont’d
• Ancient records in China and Greece indicate the
importance of organization and administration, but
do not give much insight into the principles of
management.
• Outstanding scholars have referred to management
activities in the running of city states and empires.

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Early Influences: Thomas
More
• Concepts of the ideal state were considered by
many 16th century writers.
• Sir Thomas More(7 February 1478 – 6 July 1535),
venerated in the Catholic Church as Saint Thomas
More, was an English lawyer, social philosopher,
author, statesman, and noted Renaissance
humanist.
• In Sir Thomas More's Utopia, for example, his
comments upon the reform of the management of
Britain were radical.

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Early Influences: Niccolo Machiavelli
 Niccolo Machiavelli, 1469-1527: The father of modern political theory, Niccolo di
Bernardo dei Machiavelli, was born at Florence, May 3, 1469.
 An Italian, Niccolo Machiavelli of Florence, was a good writer and was sent on
assignments at home and abroad where he observed governments and men in
action.
 His famous book ‘The prince’ Machiavelli firmly believes that the soundness of the
state is derived from a powerful military.
 The prince insight:
1. Statesmanship and War: The presence of sound military forces indicates the
presence of sound laws.
2. Goodwill and Hatred: Machiavelli is at great pains to demonstrate the careful
balance a prince must maintain between being loved and feared.
3. Free Will: One of the most controversial aspects of The Prince in its time is the
implication that rulers derive their power and authority through the exertion of their
own will. This is in contradistinction with the prevailing belief at the time which is
the rulers derive their power and authority by divine right alone.
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Cont’d
• He suggested that he should inspire people to
greater achievement, offer rewards and incentives
& take advantage of all opportunities.
• He stressed that survival was the main objective
of any organization and no matter what measures
were taken to achieve this end, they should be
taken.
• The end justifies the means!

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 Early Influences: Charles
Babbage
• Charles Babbage, (born December 26, 1791, London,
England & died October 18, 1871, London), English
mathematician and inventor who is credited with having
conceived the first automatic digital computer.
• In a much later period, Charles Babbage (1792-1871),
who was a professor of mathematics at Cambridge
University, recognized that science and mathematics
could be applied to the operation of factories and also
that more detailed cost measurements were needed.

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 Cont’d
• He also developed a calculating machine, but lack of
suitable materials made it difficult for him to make many
refinements to it.
• Babbage is sometimes referred to as "father of
computing." The International Charles Babbage Society
(later the Charles Babbage Institute) took his name to
honor his intellectual contributions and their relation to
modern computers.
• English mathematician and inventor Charles Babbage is
credited with having conceived the first automatic digital
computer. During the mid-1830s Babbage developed
plans for the Analytical Engine.
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 2. Classical Management Theory
Major Branches in the Classical Approach to Management

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 Cont’d
Four guiding principles of scientific management (Frederick
Taylor) (Finding one best way)
1. Develop for every job a “science” that includes rules of
motion, standardized work implements, and proper working
conditions.
2. Carefully select workers with the right abilities for the job.
3. Carefully train workers to do the job and give them the
proper incentives to cooperate with the job “science.”
4. Support workers by carefully planning their work and by
smoothing the way as they go about their jobs.

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Cont’d
 Frank and Lillian Gilbreth continued their motion study
and analysis in other fields and pioneered in the use of
motion pictures for studying work and workers.
 They originated micro-motion study, a breakdown of work
into fundamental elements and Human fatigue could then
be decreased by eliminating wasted motion.
 Scientific Management (the Gilbreths);
 Motion study: Science of reducing a job or task to its
basic physical motions
 Eliminating wasted motions improves performance.

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 Cont’d
Practical Lessons from Scientific Management:
Make results-based compensation a performance incentive
Carefully design jobs with efficient work methods
Carefully select workers with the abilities to do these jobs
Train workers to perform jobs to the best of their abilities
Train supervisors to support workers so they can perform
jobs to the best of their abilities

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Administrative Theory
Administrative principles (Henri Fayol)

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Cont’d

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Cont’d
• Administrative Principles (Henri Fayol)
– Scalar chain
• there should be a clear and unbroken line of
communication from the top to the bottom of the
organization
– Unity of command
• each person should receive orders from only one
boss
– Unity of direction
• one person should be in charge of all activities with
the same performance objective

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Discussion

Discuses Fayol’s 14 principles of

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 Bureaucratic Organization (Max Weber)
Bureaucratic Organization (Max Weber)
– Bureaucracy
• An ideal, intentionally rational, and very efficient
form of organization
• Based on principles of logic, order, and legitimate
authority

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cont’d
• Characteristics of Bureaucratic
Organizations:
Clear division of labor
Clear hierarchy of authority
Formal rules and procedures
Impersonality
Careers based on merit

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Cont’d
• Possible Disadvantages of Bureaucracy:
– Excessive paperwork or “red tape”
– Slowness in handling problems
– Rigidity in the face of shifting needs
– Resistance to change
– Employee apathy or lack sense of purpose

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3. Behavioral Management Approaches

Foundations in the Behavioral or Human

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Cont’d
• Organizations as communities (Mary Parker
Follett)
– Groups and human cooperation:
• Groups allow individuals to combine their talents
for a greater good
• Organizations are cooperating “communities” of
managers and workers
• Manager’s job is to help people cooperate and
achieve an integration of interests

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Cont’d
• Organizations as Communities
– Forward-looking management insights:

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Cont’d
• Hawthorne Studies:
– Initial study examined how economic
incentives and physical conditions affected
worker output
– No consistent relationship found
– “Psychological factors” influenced results

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Cont’d
• Hawthorne Studies (cont.)
– Social setting and human relations
• Manipulated physical work conditions to assess
impact on output
• Designed to minimize the “psychological factors” of
previous experiment
• Mayo and colleagues concluded:
– New “social setting” led workers to do good job
– Good “human relations” = higher productivity

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Cont’d
• Hawthorne Studies (cont.)
– Employee attitudes and group processes
• Some things satisfied some workers but not others
• People restricted output to adhere to group norms

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Cont’d
• Lessons from the Hawthorne Studies:
– Social and human concerns are keys to
productivity
– Hawthorne effect — people who are singled out
for special attention perform as expected

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Cont’d
• Maslow’s Theory of Human Needs:
– A need is a physiological or psychological
deficiency a person feels compelled to satisfy
– Need levels:
• Physiological
• Safety
• Social
• Esteem
• Self-actualization

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Cont’d
• McGregor’s Theory X Assumes that
Workers:
– Dislike work
– Lack ambition
– Are irresponsible
– Resist change
– Prefer to be led

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Cont’d
• McGregor’s Theory Y Assumes that
Workers are:
– Willing to work
– Capable of self control
– Willing to accept responsibility
– Imaginative and creative
– Capable of self-direction

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Cont’d
• Implications of Theory X and Theory Y:
– Managers create self-fulfilling prophecies
– Theory X managers create situations where
workers become dependent and reluctant
– Theory Y managers create situations where
workers respond with initiative and high
performance
• Central to notions of empowerment and self-
management

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Cont’d
• Argyris’s Theory of Adult Personality:
– Classical management principles and practices
inhibit worker maturation and are inconsistent
with the mature adult personality
– Psychological success occurs when people
define own goals

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Cont’d
• Argyris’s Theory of Adult Personality:
– Management practices should accommodate the
mature personality by:
• Increasing task responsibility
• Increasing task variety
• Using participative decision making

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 4. Modern Management Theories
• Some of Modern Management Theories are

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Cont’d
• Quantitative Analysis & Tools:
• Analytics – the use of large data bases and
mathematics to solve problems and make
informed decisions using systematic analysis
• Typical quantitative approach to managerial
problem-solving
– Problem encountered, it is systematically
analyzed, appropriate mathematical models and
computations applied, optimal solution
identified

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Cont’d
• Organizations as Systems:
– System
• Collection of interrelated parts that function
together to achieve a common purpose
– Subsystem
• A smaller component of a larger system
– Open systems
• Organizations that interact with their environments
in the continual process of transforming resource
inputs into outputs

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Cont’d
• Contingency Thinking:
– Tries to match managerial responses with
problems and opportunities unique to different
situations
– No “one best way” to manage
– Appropriate way to manage depends on the
situation

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Cont’d
• Quality Management:
– Managers and workers in progressive
organizations are quality conscious
• Quality and competitive advantage are linked
– Total quality management (TQM)
• Comprehensive approach to continuous quality
improvement for a total organization
• Creates context for the value chain

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Cont’d
– Continuous Improvement:
• Continual search for new ways to improve
quality
• Something always can and should be
improved
– ISO Certification
• Global quality benchmark
• Refine and upgrade quality to meet ISO
standards

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