Evolution of Management Thought

Dates back to when people first attempted to accomplish goals by working together in groups. Avoid rediscovering previously known ideas.

Frederick Taylor
Acknowledged as "the father of scientific management."
Experience as an apprentice, a common laborer, a foreman, a master mechanic, and then the chief engineer of Midvale Steel Company, Philadelphia. Studied First hand the problems and attitudes of workers & to see the greatest possibilities for improving the quality of management.

Contribution
His primary concern was to increase productivity through greater efficiency in production and Increased pay for workers,through the application of the scientific method.(Higher Productivity)

Taylors Principles
Replacing rules of thumb with science (organized knowledge). Obtaining harmony in group action, rather than discord.(Workers,managers & owners) Achieving cooperation of human beings, rather than chaotic individualism. Working for maximum output, rather than restricted output. Developing all workers to the fullest extent possible for their own and their company's highest prosperity.

Productivity
Problem of Productivity was a matter of ignorance on the part of both management & labor Neither managers nor workers knew what constituted a fair days work & "fair day's pay." Both managers and workers were concerned too much with how they should divide the surplus that arose from productivity-the split in thinking between pay and profitsand not enough with increasing the surplus so that both owners and laborers could get more compensation. Productivity is the answer to both higher wages and profits. Application of scientific methods, instead of custom and rule of thumb, could yield productivity without the expenditure of more human energy or effort.

Caselet-Textile Industry
Why is the productivity of workers higher in Chinas textile industry compared to India? Chinas labor force is highly Disciplined 6-6.5 days a work week 12 Hours Shift Lower Attrition

Caselet-Diamond Industry
The cost of processing one carat of diamond in China is $17 compared to $10 in India. Chinese labor is considered more skilled & disciplined than its Indian counterpart,with higher productivity offsetting the cost differential. The Scale & professionalism of chinese factory is far superior.Indias workshops are small & inefficient.

Caselet-Software Industry
Why is the productivity of workers higher in Israels software industry(55,000) compared to Indias 200,000(2005 Figures).

Followers of Taylor-Henry L Gantt

Consulting work on the scientific selection of workers and the development of incentive bonus systems. Emphasized the importance of careful advance planning by managers and the responsibility of managers to design work systems so that workers would be helped to do their best.

Contribution- Gantt Charts

Wide use today and was the forerunner of such modern techniques as the PERT Development of graphic methods of describing plans and making possible better managerial control Emphasized the importance of time, as well as cost, in planning and controlling work. (Public-Private Partnership in Infrastructure projects)

Frank & Lilian Gilbreth

Rare combination of talents-Lillian Gilbreth's interest in the human aspects of work and her husband's interest in efficiency. Interested in wasted motions in work. Reduced the No. of bricklaying motions from 18 to 5. Made possible the doubling of a bricklayers productivity with no greater expenditure of effort. Conclusion that it is not the monotony of work that causes so much worker dissatisfaction but, rather, management's lack of interest in workers.

Frank B. Gilbreth (1868-1924)Shown here using a "motion study" device

Henry Fayol

FAYOL'S ACTIVITIES IN INDUSTRIAL UNDERTAKING.

Financial

Security Commercial
MANAGERS ACTIVITIES

Technical

Managerial Planning yOrganization yCommand yCoordination yControl Accounting

Activities of an industrial undertaking could be divided into six groups (1) Technical (production) (2) Commercial (buying, selling, and exchanging) (3) Financial (search for, and optimum use of, capital) (4) Security (protection of property and persons) (5) Accounting (including statistics), and (6) Managerial (planning, organization, command, coordination, and control).

Fayols 14 Principles
1. Division of work 2. Authority and responsibility 3. Discipline 4. Unity of command. 5. Unity of direction 6. Subordination of individual to general interest 7. Remuneration. 8. Centralization 9. Scalar Chain 10. Order (Monster.com) 11. Equity 12. Stability 13. Initiative 14. Espirit de Corps

1. Division of Work
Every work must be done by perfect employee Henry Fayol introduced this principle for fast production in factory and with this principle of management , skill and efficiency of labourers increase . They become specialize in their work , after this company can increase the standard of their product .

2. Equity of Authority and responsibility

This principle says that authorities and responsibility are two part of one coin This should be in the knowledge of every employee of any company because higher authority can ask about completing of any work and make you accountable also.
Authority without responsibility is corruption Responsibility without authority is failure

3. Discipline
Discipline means obey the order of higher administrator . This principle explains the cultural and ethical value of Old India where if a person learnt from his master , he used to obey every duty of his master . Discipline in work and in employee is key of success .

4. Unity of Command
This principle states that orders should be given from one higher authority for the continuity of work. If there are 2 higher authority who give order to one subordinate, then subordinate will misguide and he will not do any work. If two authority are in same rank , then Co. should promote or transfer one of them .

5. Unity of direction
Direction : It is just guidance without any order or there is not the provision of penalty or punishment. Command : If employee will not follow it , it is possible that employer will give punishment for not obeying. Direction is more powerful tool in the hand of manager because with this manager can make democratic environment

6. Subordination of individual interest to General interest

7. Remuneration
If company wants to develop employee and increase production , then company should provide not only high salary but also provides large number perquisites to employees. Salary which does not cover cost of living(High food & property prices) will result in employee dissatisfaction & turnover.

If you pay peanuts,you will get monkey

8. Centralisation
This principle explains that all the high powers relating to making plans and taking decisions must be in few hands and centralisation of power is good way to promote business with high speed. If all powers are decentralised , then it may be possible that it is misused.

9. Scalar Chain
Business is divided under different levels of management and one authority is above from every subordination but problem arises when one subordinate wants to communicate to other equal rank subordinate .

10. Orderliness

11. Equality
All employees are same in the eye of business . There is no need to do any partiality (Salary or Promotion)on the basis of
Religion Language Community Etnicity Gender

12. Stability of Employees

Stable employee in any organisation is like fixed asset Company can provide stability to employees by providing
Good monetary compensation Non monetary incentives
Work Environment Challenging Assignments Recognition of achievement

13. Initiative
Initiatives are those motivations which are helpful for employee to do all work with better way. All employees feel happy , if some higher authority initiates them to do any work by themselves.

14. Espirit de corps

Espirit de corps means strength in unity.

Shoaib Akhtar

Suresh Raina

ROLE PLAY

The Human Relations Movement Sociological Approach

Managers faced difficulty because employees did not always follow predicted or rational patterns of behaviour. Increased interest in helping managers deal more effectively with the people dide of their business.

The Hawthorne Studies

Experiment at the Hawthorne plant of the Western Electric Company between 1927 and 1932,spearheaded by ProfElton Mayo Illumination Experiments Affect Production only marginally. Relay Assembly Test Room Impact of factors as length of working day,rest pauses,their frequency & duration Group of 6 women workers Variations made in working conditions to find out which combination most ideal for production

Cont
Neither closely supervised nor motivated by extra rewards Production of the group had no relation with working conditions as productivity went on increasing & stabilised at a high level.

Relay Room of the Western Electric Company,Hawthorne,Illinois, plant in 1927

Researchers attributed this phenomenon to the following factors: Feeling of importance among the girls as a result of their participation in the research & the attention they got. Warm informality in the small group and tension free inter-personal and social relations as a result of the relative freedom from strict supervision and rules. High group cohesion among the girls.

Bank Wiring Observation Room

Determine the effect of informal group norms & formal economic incentives on productivity. Group evolved its own production norms for each individual worker,which was much lower than those set by management.

Cont
Workers who in their foolishness tried to produce more than the group norm were isolated, harassed or punished by the group in several ways and were called Rate Busters. Workers who were too slow were nicknamed as Chisellers. Workers who complained to the supervisor against their co workers were called Squealers.

Summary
1. A business organisation is not merely a technoeconomic system (machinery, methods) but is also a social system.i.e. improvement in productivity was due to such social factors as
Morale Satisfactory interrelationships between members of a work group (a "sense of belonging) Effective management

2. There is no correlation between improved working conditions and high production.

Cont
3. A workers production norm is set & enforced by his group & not by the time & motion study done by any industrial engineer. 4. A worker does not work for money only.Nonfinancial rewards(such as affection & respect of his co-workers) also significantly affect his behaviour & largely limit the effect of economic incentive plan. 5. Employee centered,democratic & participatory style of supervisory leadership is more effective than task centered leadership.

Limitations
Swing in the opposite direction Implicit belief that an organisation can be turned into one big happy family which satisfies everybody. Over-emphasises the importance of symbolic rewards & underplays the role of material rewards. Approach is production oriented & not employee oriented. Leisurely process of decision making Makes an unrealistic demand on the superior.

Industrial Psychology
Hugo Munsterberg:Acknowledged to be "the father of industrial psychology,. Saw the importance of applying behavioral science to the new scientific-management movement.

Book titled Psychology and Industrial Efficiency

1. 2. How to find people 'whose mental qualities best fit them for the work they are to do? Under what psychological conditions the greatest and most satisfactory output can be obtained from the work of every person? How a business can influence workers in such a way as to obtain the best possible results from them? He stressed that his approach was even more strongly aimed at workers and that through it he hoped to
Reduce their working time, Increase their wages, and Raise their "level of life.

3.

Sociological Approach to Management

Observing people as products of group behaviour Max Weber: hierarchy, authority, and bureaucracy (including clear rules, definition of tasks, and discipline) lie at the foundation of all social organizations Emile Durkheim:Groups, by establishing their values and norms, control human conduct in any social organization.

Vilfredo Pareto:
The father of the social systems approach" to organization and management Viewed society as an intricate cluster of interdependent units, or elements-i,.e, as a social system with many subsystems. Social attitudes, or sentiments, function to cause the system to seek an equilibrium when disturbed by outside or inside influence.

APPROACHES TO MANAGEMENT

1.EMPIRICAL, OR CASE, APPROACH

ILLUSTRATION CHARACTERISTICS CONTRIBUTIONS Studies experience through cases. Identifies successes and failures. LIMITATIONS Studies experience through cases. Identifies successes and failures.
Case situation

Failure

Successes

Why?

2. INTERPERSONAL BEHAVIOR APPROACH

ILLUSTRATION CHARACTERISTICS CONTRIBUTIONS Focus on interpersonal behavior, human relations, leadership, and motivation. Based on individual psychology. LIMITATIONS Ignores planning, organizing, and controlling. Psychological training is not enough to become an effec-tive manager.

b
Focus of study

3. GROUP BEHAVIOR APPROACH

ILLUSTRATION CHARACTERISTICS CONTRIBUTIONS Emphasis on behavior of people in groups. Based on sociology and social psychology. Primarily study of group behavior patterns. The study of large groups is often called "organization behavior." LIMITATIONS Often not integrated with manage-ment concepts, principles, theory, and techniques. Need for closer integration with organization structure design, staffing, planning, and controlling.
Study of Group other Study of groups interacting with each

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4. COOPERATIVE SOCIAL SYSTEMS APPROACH

ILLUSTRATION CHARACTERISTICS CONTRIBUTIONS Concerned with both interpersonal and group behavioral aspects lead-ing to a system of cooperation. Expanded concept includes any cooperative group with a clear purpose. LIMITATIONS Too broad a field for the study of management. At the same time, it overlooks many managerial con-cepts, principles, and techniques.
Common Goal

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5. SOCIOTECHNICAL SYSTEMS APPROACH

ILLUSTRATION CHARACTERISTICS CONTRIBUTIONS Technical system has great effect on social system (personal atti-tudes, group behavior). Focus on production, office operations, and other areas with close relationships between the technical system and people. LIMITATIONS Emphasis only on blue-collar and lower-level office work. Ignores much of other managerial knowledge.

6. Decision Theory Approach

ILLUSTRATION CHARACTERISTICS CONTRIBUTIONS LIMITATIONS

There is more to Focus on the making of managing than decisions, persons or making decisions. groups making deci-sions, The focus is at the and the decision-making same time too process. Some theorists narrow and too wide. use decision making as a springboard to study all enterprise activities. The boundaries of study are no longer clearly defined.

7. SYSTEMS APPROACH
ILLUSTRATION CHARACTERISTICS CONTRIBUTIONS Systems concepts have broad applicability,. Systems have boundaries, but they also interact with the external environment; i.e., organizations are open systems. Recognizes importance of studying interrelatedness of planning, organizing, and controlling in an organization as well as the many subsystems. LIMITATIONS Analyses of the interrelatedness of systems and subsystems as well as the interactions of organizations with their external environment. Can hardly be considered a new approach to management..

8. MATHEMATICAL Oil "MANAGEMENT SCIENCE" APPROACR

ILLUSTRATION CHARACTERISTICS CONTRIBUTIONS Preoccupation with mathematical models. Many aspects in managing cannot be modeled. Mathematics is a useful tool, but hardly a school or an approach to management. LIMITATIONS Managing is seen as mathematical processes, concepts, symbols, and models. Looks at management as a purely logical process, expressed in mathematical symbols and relationships.

9. CONTINGENCY OR SITUATIONAL APPROACH

ILLUSTRATION CHARACTERISTICS CONTRIBUTIONS Managerial practice depends on circumstances (i.e., a contingency or a situation). Contingency theory recognizes the influence of given solutions on organizational behavior patterns. LIMITATIONS Managers have long realized that there is no one best way to do things. Difficulty in determining all relevant contingency factors and showing their relationships. Can be very complex.

10. MANAGERIAL ROLES APPROACH

ILLUSTRATION CHARACTERISTICS CONTRIBUTIONS Original study consisted of observations of five chief executives. On the basis of this study, ten managerial roles were identified and grouped into (7) interpersonal, (2) informational, and (3) decision roles. LIMITATIONS Original sample was very small. Some activities are not managerial. Activities are evidence of planning, organizing, staffing, leading, and controlling. But some important managerial activities were left out (e.g., appraising managers).

11. MCKINSEY'S 7-S FRAMEWORK

ILLUSTRATION CHARACTERISTICS CONTRIBUTIONS The seven S's are (i) strategy, (2) structure, (3) systems, (4) style, (5) staff, (6) shared values, (7) skills. LIMITATIONS Although this experienced consulting firm now uses a framework similar to the one found useful by Koontz et al. since 1955 (see Table 2-2) and confirms its practicality, the terms used are not precise and topics are not discussed in depth.

12. OPERATIONAL APPROACH

CHARACTERISTICS CONTRIBUTIONS Draws together concepts, princi-ples, techniques, and knowledge from other fields and managerial approaches. The attempt is to develop science and theory with practical application. Distinguishes between managerial and no managerial knowledge. Develops classification system built around the managerial functions of planning, organizing, staffing, lead-ing, and controlling. LIMITATIONS Does not, as some authors do, identify "representing" or "coordi-nation" as a separate function. Coordination, for example, is the essence of managership and is the purpose of managing. ILLUSTRATION

THE OPERATIONAL OR MANAGEMENT PROCESS APPROACH