Evolution of Management

1. The classical theory of management

- scientific management
-bureaucratic management
-administrative management
2. Neo Classical Theory
- Human relations
-Behavioral Science
3. Modern Mnagement
- Quantitative Approach
- System approach
-Contingency Approach
- Theory Z
Bureaucratic Approach to Management-Max Weber(1864 -1920)
Max Weber analyzed functioning of church,government, military and business
organisations.
He believed that bureaucracy was the most efficientform of a business structure for any
type of businessorganisation.
Features of bureaucracy Theory
Administrative Class:
This class exists in a bureaucratic organisation
The employees are full time and look after coordinationamong activities
Hierarchy:
It is a system of ranking
Strict rules of authority responsibility
Serves lines of communication and delegation of authority
Division of work:
Organisation divided in various departments
Each department will have a specific function
Clear definition of work
Official Rules:
Administrative process covered by rules
Antithesis to ad hoc
Provides stability and uniformity
Impersonal Relationships
Official relationships free from personal involvement,emotions and sentiments
Decisions are based on rational thinking
Official Record:
Maintenance of official records
Beneficial for future reference
Filing system used extensively

Scientific Management FrederickW. Taylor (1856-1915)

Aworker and then a supervisor in steel company
Carried experiments to increase efficiency of theworkers
Published many books and papers
Studied M.E (Masters of Engineering)
His experiments are divided into
Elements and tools of scientific management
Principles of scientific management
Elements and tools of scientific management
1.Separation of planning and doing-Supervisor plans, worker only carries out the task
2.Functional foremanship- 4types of supervisors for planningaspect, while 4 for
supervision aspect of the work
3.Job Analysis-best way to do a job
4.Standardisation - of process, period and amount of work,working conditions, tools
used etc
5.Scientific selection and training of workers
6.Financial incentives
7.Economy-optimum usage of resources an eliminate or reduce wastages
8. Mental revolution - cooperation between workers and themanagement
Principles of scientific management
Replacing rule of thumb with science
Harmony in group actions
Cooperation
Maximum output
Development of workers
Critical Analysis of Scientific Management
Relevant from an engineering point of view rather thanmanagement point of view
Human aspect of the work was sidelined-workers gotaggressive resulting in unhealthy
competition
Increased authoritarian approach in industries-strictsupervision
Financial incentives exploited the workers (Differentialpiece rate system)
Administrative Management Henry Fayol (1841-1915)
-French Industrialist Used the term
-Administration instead of Management
Divided industrial organisation into 6 groups
Technical
Commercial
Financial
Security
Accounting

Managerial
Identified qualities of a Manager
Managerial Qualities and training-according to Fayol
Physical-Health
Mental-ability to learn, judge, think, plan
Moral-loyalty, firmness, tact, dignity
Educational-acquaintance to subjects not related tofunctions performed
Technical-pertaining to the function performed, eg,production
Experience-arising through work
Fayols 14 principles of Management
1.Division of workTo take advantage of specialisation, every worker/manager works on
a same part/function.It increases theaccuracy, ability and speed of work.
2.AuthorityandresponsibilityBoth are related.Authority arises out of a managersposition
and responsibility, out of assignment of activity.Acc, to Fayol, there should be parity
(equality) betweenboth.
3.Discipline It can be self imposed, or commanded. Disciple bycommand arises through
company policies.
4.Unity in command A person should get orders from only one superior.
Thisincreases clarity, reduces conflict and builds a personalresponsibility for results If it
is violated, discipline is lost, importance of authoritydecreases and stability is
threatened.
5.Unity of direction
Each group of activities with same objective, must haveonly one plan and one
head.Unity in command defines the reporting relationship, whileunity in direction defines
the grouping of activities.It ensures better coordination among activities.
6.Subordination of individual, to general interest Interest of the organisation is more
important than theinterest of one/few employees, when there is a conflictbetween the
two.Hence, superiors should be the ideals, superviseemployees continuously and also
have a fair agreementwith them.
7.Centralisation An organisation must have a proper balance of centralisation and
decentralisation, depending on itssize, activities, objectives, employees etc.
8.Remuneration Should be fair to both-employee and employer In line with cost of living
and value of employeeFayol did not advocate profit sharing plan for workers,but for
managers
9.Scalar chain It is the flow of authority or command, through whichevery
communication, must pass In special circumstances, this flow can be short-circuited
in situations, when the scalar chain of communication is non feasible.
This is done, using agang plank
10.Order This refers to arrangement of things and people in anorganisation- A place for
everything and everything inplaceSimilarly, the right person must be placed at the
rightposition.This demands for precise knowledge of humanrequirement and resources
11.Equity combination of justice and kindness It should be maintained in behaviour and
treatmenttowards employees
12.Stability of Tenure
Employee should be given a minimum job security atleast
This ensures that he is given time to adjust to new workand succeed in it.
13.Initiative
Managers must encourage employees to take initiative,within the limits of their authority.
It increases the zeal and energy in the employee
14.E spirit de Corps

Union is strengthManagers must encourage the team spirit among theemployeesErring

employees must be given oral directions and notasked for a written explanation
The human relations approach -Elton Mayo
Conducted the famous Hawthorne Experiments carried out atthe Western Electric
Company, in the United States of Americathat started in the early1920s.
In the approaches by
Taylor and Fayol, the human element inthe organisation was not stressed upon.
The elements in these approaches were not giving evokingpositive results.
The Western Electric Company, Chicago had Hawthorne plantthat manufactured
telephone bell system
The company was progressive, with sickness and pensionbenefits In spite of this, there
was a dissatisfaction among workers.
ExperimentI:
Two group of workers, experimented withthe lighting or illumination and its effect on
productivity,
showed no clear correlation between light level andproductivity.
ExperimentII:
Agirls group was chosen who worked inthe telephone relay assembly department. 5
types of changes introduced over a period of time and productivitymeasured after every
change.
ExperimentIII:
20,000 interviews conducted in two yearsto determine employees attitude towards
company, work,supervision, waged, insurance, incentives etc.
ExperimentIV:
14 male workers were employed andhypothesis was that they would produce more in
order toearn more.It was proved wrong due to 4reasons given byworkers for a lesser
output.
The human relations approach -Chester Barnard
He was the president of New Jersey Bell
Telephone Company.
He saw organizations as social systems thatrequired human cooperation.
He believed that managers major roles were tocommunicate and stimulate
subordinates to highlevels of effort.
He also introduced the idea that managers haveto examine the environment and then
adjust theorganization to maintain a state of equilibrium.

He connected Scientific Management with HumanRelations.

Felt that executives servetwo primaryfunctions:
Must establish and maintain a communications systemamong employees.
Must establish the objectives of the organization andmotivate employees.
Developedanacceptancetheoryofauthority:
Authority of a manager flows from the ability of subordinates to accept or reject an order

from themanager once they:

Comprehend what the order requires of them.
Review the orders consistency with organization goals.
Perceive a personal benefit in obeying the order.
Behavioral Approach
Mary Parker Follet: Focus on Group Influences
Human Element Human Element
Groups
Power Sharing
Integrity
Modern Approach to management
Quantitative Approach
The Systems Approach
The Contingency Approach
The Japanese managementstyle (theory z)
Quantitative Approach
MeasurableCriteria
The decision-making process requires that the decisionmaker select some alternative
course of action.
The alternatives must be compared on the basis of measurable criteria.
Quantitative Model
To assess the likely impact of each alternative on thestated criteria, a quantitative model
of the decisionsituation must be formulated.
Computers are quite useful in the problem-solvingprocess.
Contributions of Quantitative Approach
InProductionManagementFocusisonmanufacturingtechnologyandtheflowofmaterialinplants.
In OperationManagement
Focusisonorganizationsuchashospitals,banks,government&themilitary.
Limitations of Quantitative Approach
Despiteitspotentialimpact,thisapproach has certainlimitations
Doesnotdealwiththepeopleaspectofanorganization!!!
Unfamiliarwithadvancedquantitativetools!!
TheSystems Approach
System Defined
A set of interrelated and interdependent parts arrangedin a manner that produces a

unified whole.
An approach to problem solving based on anunderstanding of the basic structure of
systems.
Basic Types of Systems
Closed systemsAre not influenced by and do not interact with their environment (all system input and
output is internal)
Open systemsDynamically interact to their environments by takingin inputs and transforming them into
outputs that aredistributed into their environments
The Contingency Approach
Contingency Approach Defined
Also sometimes called the situational approach.
There is no one universally applicable set of managementprinciples (rules) by which to
manage organizations.
Organizations are individually different, face differentsituations (contingency variables),
and require differentways of managing.
Asserts that managers are responsible for determiningwhich managerial approach is
likely to be most effectivein a given situation.
This requires managers to identify the key contingenciesin a given situation.
Japanese Management StyleTheory Z
Theory Z
Involves providing job security to employees.
Ensures job rotation of employees to developtheir crosstheir cross--rotational
skills.rotational skills.
Advocates participation of employees in thedecision making processdecision making
process
Emphasizes on use of informal control inorganization.organization.
Shows concern for employees wellbeing
Lays emphasis on their training anddevelopment development