Topic 2.

The Evolution of Management Thinking

Organization and Management

Organization is a collection of people working together in a division of

labour to achieve a common purpose. Management is the attainment of
organizational goals in an effective and efficient manner through four
functions: planning, organizing, leading, controlling.

Forces Influencing Management and Organisations: Social Forces,

Political Forces, Economic Forces.

Social Forces – aspects of a culture that guide and influence

relationship among people. What do people values? What do people
need? What are the standards of behavior among people?

These forces shape the social contract which refer to the unwritten,
common rules and perceptions about relationships among people
and between employees and management

Political Forces - influence of political and legal institutions on

people & organizations. Political forces include basic assumptions
underlying the political system such as the desirability of self-
government, property rights, contract rights, The definition of
justice, The determination of innocence or guilt of a crime.

Economic Forces - forces that affect the availability, production, &

distribution of a society’s resources among competing users. The
new emerging economy is based largely on ideas, information, and
knowledge; supply chains have been revolutionized by digital
technology. Management practices and perspectives vary in
response to these social, political, and economic forces; during hard
times, manager look for ideas to help them cope.

Management Perspectives Over Time

Classical Perspective

The classical perspective emerged during the 19th and 20th

centuries. The factory system of the 1800s had challenges:

➢ tooling plants,

➢ organizing managerial structure,

➢ training non-English speaking employees,

➢ scheduling complex manufacturing and operations

➢ dealing with increased labor dissatisfaction and resulting

strikes

These new problems demanded a new perspective on coordination

and control, make organizations efficient operating machines,
Rational, scientific approach to management, The overall classical
perspective as an approach to management was very powerful and
gave companies fundamental new skills for establishing high
productivity and effective treatment of employees.

This perspective contains three subfields:

a) Scientific Management
➢ A subfield of the classical management perspective that
emphasized scientifically determined changes in management
practices as the solution to improving labour productivity.
Frederick W. Taylor – known as the father of scientific
management
 ➢ Emphasized scientific changes in management to improve
labor productivity
➢ Taylor suggested decisions based on rules of thumb and
tradition be replaced with precise work procedures developed
after study of the situation

➢ Henri Gantt developed the Gantt Chart – a bar graph that

measures planned and completed work

➢ Frank B and Lilian M. Gilbreath pioneered time and motion

study, which stressed efficiency and the best way to do a job

➢ Frank is known for work with brick layers, but surgeons were
able to save countless lives through the application of the time
and motion study

➢ Lilian pioneered the field of industrial psychology and made

substantial contributions to human resource management

b) Bureaucratic Organizations
Max Weber 1864-1920, Prior to Bureaucracy Organizations
i) European employees were loyal to a single individual
rather than to the organization or its mission
ii) Resources used to realize individual desires rather than
organizational goals
iii) Systematic approach –looked at organization as a whole
A subfield of the classical management perspective that
emphasized management on an impersonal, rational basis
through such elements as clearly defined authority and
responsibility, formal record-keeping and separation of
management and ownership

c) Administrative Principles

Contributors: Henri Fayol, Mary Parker, and Chester I. Barnard

Focus: A subfield of the classical management perspective

that focuses on the total organization rather than the
individual worker, delineating the management functions of
planning, organizing, commanding, coordinating and
controlling.

14 General Principles of Management

Importance of common super-ordinate goals for reducing conflict in

organizations
 ➢ Popular with businesspeople of her day

➢ Overlooked by management scholars

➢ Contrast to scientific management

➢ Reemerging as applicable in dealing with rapid change in

global environment

Leadership – importance of people vs. engineering techniques

Chester Barnard 1886-1961: Informal Organization

➢ Cliques

➢ Naturally occurring social groupings

➢ Argued that organizations are not machines and informal

relationship are powerful forces that can help the organization
if properly managed

Acceptance Theory of Authority

➢ Free will
➢ Can choose to follow management orders and acceptance can
be critical to success

Humanistic Perspective

A management perspective that emerged around the late 19th

century, Emphasized understanding human behavior, needs, and
attitudes in the workplace. Mary Parker Follett and Chest Barnard
advocated a more humanistic perspective on management that
emphasized:

➢ Importance of understanding human behaviors

➢ Needs and attitudes in the workplace

Human Relations Movement

➢ Truly effective control comes from within the individual worker

rather than from strict, authoritarian control

➢ Emphasized satisfaction of employees’ basic needs as the key

to increased worker productivity

Hawthorne Studies

➢ Factor that increased output, Human Relations

 ➢ Suggests jobs should be designed to meet higher-level
needs by allowing workers to use their full potential
➢ The human resources perspective combines prescription for
design of job tasks with theories of motivation
➢ 2 best known contributors:
➢ Abraham Maslow (1906-1970), a psychologist, suggested a
hierarchy of needs because he observed that problems
usually stemmed an inability to satisfy needs: Self-
actualization, Esteem, Belongingness, Safety, Physiological

Theory X Assumptions

➢ Dislike work –will avoid it

➢ Must be coerced, controlled, directed, or threatened with

punishment

➢ Prefer direction, avoid responsibility, little ambition, want

security

Theory Y Assumptions

➢ Do not dislike work

➢ Self direction and self control

➢ Seek responsibility

➢ Imagination, creativity widely distributed

➢ Intellectual potential only partially utilized.

Behavioral Sciences Approach

➢ Applies social science in an organizational context

➢ Draws from economics, psychology, sociology, anthropology,
and other disciplines
➢ Understand employee behavior and interaction in an
organizational setting
➢ One set of management techniques based in the behavioral
sciences approach is OD – Organization Development
➢ Other concepts that grew out of the Behavioral Sciences
Approach include matrix organizations, self-managed teams,
and ideas about corporate culture

Management Science Perspective

➢ Emerged after WW II
 ➢ Applied mathematics, statistics, and other quantitative
techniques to managerial problems

Operations Research: It consist of mathematical model building and

other applications of quantitative techniques to managerial
problems

Operations Management: specializes in physical production of goods

or services using quantitative techniques to solve manufacturing
problems, e.g. forecasting, inventory modeling, linear and nonlinear
programming, queuing theory, scheduling, simulation and break-
even analysis

Information Technology: reflected in management information

systems. These are designed to provide relevant information to
managers in a timely and cost-efficient manner, e.g. intranet,
extranet, software programs.

System Theory

A system theory is a set of interrelated parts that function as a

whole to achieve a common purpose. A system functions by
acquiring inputs from the external environment, transforming them
in some way and discharging outputs back to the
environment.Components of system theory include:

a) Inputs: Inputs are the material, human, financial or information

resources used to produce goods and services.
b) Transformation process:The transformation process is
management’s use of production technology to change the inputs
into outputs.

c) Outputs:Outputs include the organization’s products and services.

d) Feedback:Feedback is knowledge of the results that influence the

selection of inputs during the next cycle of the process.

e) Environment: The environment surrounding the organization

includes the social, political and economic forces.

Contingency View of Management

Successful resolution of organizational problems is thought to

depend on managers’ identification of key variations in the situation
at hand

Total Quality Management (TQM)

A concept that focuses on managing the total organisation to deliver

quality to customers. The approach infuses quality values
throughout every activity, with front-line workers intimately
involved in the process. 4 significant elements of TQM are:

➢ Employment involvement – requires company-wide

participation in quality control.

➢ Focus on customer – find out what customer wants.

➢ Benchmarking – a process whereby companies find out

how others do something better and imitate or improve
it.

➢ Continuous improvement – the implementation of small,

incremental improvements in all areas of the
organization on an ongoing basis.
The Learning Organization

In the learning organization, everyone identifies and solves

problems, enabling continuous experiment, change, and
Improvement. Thus increasing its capacity to grow, learn and
achieve its purpose. The essential idea is problem solving, as
opposed to efficiency, e.g. understanding customer needs.

The Technology-Driven Workplace

Types of E-Commerce