The Evolution of Management

Thinking

Prof. Nitin Bolinjkar 1

 Classical Management Perspective
• One of the first schools of management thought, the Classical
Management Perspective, developed during the Industrial Revolution
when new problems related to the factory system began to appear.
• The classical management theory developed from efforts to find the
“one best way”.
This school of thought is made up of two branches:
– Classical Scientific Branch arose from the need to increase productivity and
efficiency. The emphasis was on trying to find the best way to get the most
work done by examining how the work process was actually accomplished and
by scrutinizing the skills of the workforce.
– Classical Administrative Branch: Whereas scientific management focused on
the productivity of individuals, the classical administrative approach
concentrated on the total organization, with an emphasis on managerial
principles rather than work methods.

Prof. Nitin Bolinjkar 2

 Gurus of Classical Scientific Branch
• Frederick Taylor is called the “father of scientific
management.” Taylor believed that organizations should study
tasks and develop precise procedures. E.g. in the Bethlehem
Steel plant, by redesigning the shovels the workers used,
Taylor was able to increase the length of work time and
decrease the number of people shoveling from 500 to 140.
• Henry Gantt, an associate of Taylor's, developed the Gantt
chart, a bar graph that measures planned and completed
work along each stage of production.
• Frank and Lillian Gilbreth, a husband‐and‐wife team, studied
job motions in standardization and method study. When
observing bricklayers Gilbreth discovered that each bricklayer
used a different set of motions to lay bricks. By isolating the
basic movements, Gilbreth eliminated unnecessary motions
increasing output from 1,000 to 2,700 bricks per day.

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 Gurus of Classical Administrative
Branch: Max Weber
• Max Weber disliked that in many organizations, employees were loyal to
individual supervisors rather than to the organization. He believed that
organizations should be managed impersonally and in a formal
organizational structure, where specific rules were followed. This non-
personal, objective form of organization was called a bureaucracy.
Weber believed that all bureaucracies have the following characteristics:
• A well‐defined hierarchy: A clear chain of command.
• Division of labor and specialization.
• Rules and regulations: Standard operating procedures to provide
certainty.
• Impersonal relationships between managers and employees so that
favoritism and personal prejudice do not influence decisions.
• Competence: not “who you know,” but ability and merit as the
primary characteristics.
• Records: maintain complete files regarding all activities.
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 Gurus of Classical Administrative Branch:
Henri Fayol’s 14 Principles of Management
1 Division of work A high degree of specialization results in
inefficiency.
2 Authority and Authority is needed to carry out managerial
responsibility responsibilities.
3 Discipline People in the organization must respect the
rules that govern the organization.
4 Unity of command Employees should receive orders, and should
report to only one superior.
5 Unity of direction each group of activities with the some objective
must have one head and one plan.
6 Subordination of Interest of individuals should not be placed
individual interest before the goals of the overall organization.
7 Remuneration Remuneration should be fair and afford the
maximum benefit to both employees and
employer.

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 Fayol’s 14 Principles of Management
(continued)
8 Centralization Power’ and authority should be concentrated at
the upper levels of the organization.
9 Scalar chain A chain of authority should extend from the top
to the bottom of the organization.
10 Order Human and material resources should be
coordinated so that they are in the required
place at the required time.
11 Equity Managers should be kind and fair when dealing
with subordinates.
12 Stability of tenure Unnecessary turnover is both the cause and the
effect of bad management.
13 Initiative Subordinates should have the freedom to take
initiative.
14 Espirit De Corps Team spirit and a sense of unity should be
fostered and maintained.

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Fayol’s Principles – Then & Now

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 Gurus of Classical Administrative Branch:
Mary Parker Follett & Chester Barnard
• Mary Parker Follett stressed the importance of of people rather than
techniques
– Discarding command‐style hierarchical organizations, she began to talk about ethics,
power, leadership and participative decision making.
• Chester Barnard, introduced the idea of the informal organization;
exclusive groups of people that naturally form within a company and
provided necessary and vital communication functions for the overall
organization.
• He is credited with developing the Acceptance theory of Authority which states that a
manager's authority rests on workers' acceptance of his right to give orders and to
expect compliance. Workers have to believe that the manager can legitimately give
orders and there is a legitimate expectation that the orders will be carried out.
There are a few reasons for this expectation:
– Workers will be rewarded for compliance
– There will be discipline for non-compliance
– Workers respect the manager for his experience
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 Humanistic Management
Perspective
• The Humanistic Management Perspective addresses
the human dimension of work.
– Emphasized satisfaction of employees’ basic needs as the
key to increased worker productivity.
– Suggests jobs should be designed to allow workers to use
their full potential.
– Believed that a better understanding of human behavior at
work, such as motivation, conflict, expectations, and group
dynamics, improved productivity.

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 Gurus of Humanistic Perspective:
Elton Mayo
• Elton Mayo's contributions came as part of the
Hawthorne studies
– The study was conducted to determine the relationship of
lighting levels to worker productivity.
– Surprisingly enough, it was discovered that worker
productivity increased as the lighting levels decreased
(until the employees were unable to see what they were
doing!)
– It was concluded that the increase in productivity resulted
from the focus on the workers rather than the changes in
lighting.
– This is the origin of the term Hawthorne effect.
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 Gurus of Humanistic Perspective:
Abraham Maslow’s
• Abraham Maslow, a practicing psychologist,
developed one of the most widely recognized
Hierarchy of Needs, a theory of motivation based
upon a consideration of human needs . His theory of
human needs had three assumptions:
– Human behavior is purposeful and is motivated by the
need for satisfaction.
– Human needs are never completely satisfied.
– Needs can be classified according to a hierarchical
structure of importance, from the lowest to highest.

Prof. Nitin Bolinjkar 11

 Abraham Maslow’s
Hierarchy of Needs - 1908-1970

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 Gurus of Humanistic Perspective:
Douglas McGregor Theory X & Y (1906-1964)
Theory X Assumptions Theory Y Assumptions
• Dislike work –will avoid it • Love work
• Must be coerced, • Self direction and self
controlled, directed, or control
threatened with • Seek responsibility
punishment • Imagination, creativity
• Prefer direction, avoid widely distributed
responsibility, little • Intellectual potential only
ambition, want security partially utilized
An important aspect of McGregor's idea was that managers who hold either set of
assumptions can create self‐fulfilling prophecies — through their behavior, these
managers create situations where subordinates act in ways that confirm the
manager's original expectations
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 Management Science Approach
• Emerged after WW II, the Management Science Approach
involves the use of quantitative techniques, such as statistics,
information models, and computer simulations, to improve
decision making.
– Managers can use computer modeling & simulations to save
both money and time.
– Mathematical forecasting helps make projections that are
useful in the planning process.
– Inventory modeling helps control inventories by
mathematically establishing how and when to order a product.
– Queuing theory helps allocate personnel or workstations to
minimize customer waiting and service cost.

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 Systems Theory

• The Systems theory treats an organization as a system.

This approach treats an organization as an open system.
An open system interacts with its environment by way of
inputs, throughputs, and outputs as an interrelated set of
elements functioning as a whole. An organization as a
system is composed of four elements:
– Inputs: include raw materials, money, technologies, and people
– Transformation processes: technological / manufacturing and
managerial processes
– Outputs: products or services designed to enhance the quality
of life or productivity for customers/clients
– Feedback: reactions from customers or clients
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 System Theory

• Ideas in systems theory that have had a substantial

influence on management thinking include:
– An organization that interacts little with its external environment
and therefore receives little feedback is called a closed system.
– An open system, in contrast, interacts continually with its
environment. Therefore, it is well informed about changes
within its surroundings and its position relative to these
changes.
– Entropy is the tendency of systems to deteriorate or break down
over time.
– Synergy is the ability of the whole system to equal more than
the sum of its parts.
– A Cybernetic System is a self-governing, self-monitoring system.
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The Organization as a System

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 Contingency View of Management

• Contingency thinking avoids the classical “one best

way” arguments and recognizes that the appropriate
management actions depend on the situation.
• Managers with a contingency view use a flexible
approach, draw on a variety of theories and
experiences, and evaluate many options as they
solve problems.
– E.g. the approach used to manage a group of teenagers
working in a fast‐food restaurant would be very different
from the approach used to manage a medical research
team trying to find a cure for a disease.
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 Total Quality Management
• TQM is a comprehensive, organization-wide effort to improve
the quality of products and services.
– W. Edwards Deming laid the foundations of Continuous
Improvement. His philosophy resulted in the Kaizen (Kai
means Change; Zen means for the better) Cycle of Plan,
Do, Check & Act.
– Joseph Moses Juran summed up the importance of total
quality management by saying TQM begins at the top of an
organization and works its way down.
– Philip "Phil" Crosby initiated the Zero Defects program
that re-defined quality to mean ‘conformity to standards
set by the industry or organization that must align with
customer needs’.

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 Learning Organization

• A learning organization is the term given to a

company that facilitates the learning of its
employees and continuously transforms itself.
• Learning organizations develop as a result of the
pressures facing modern organizations and enables
them to remain competitive in the business
environment.

Prof. Nitin Bolinjkar 20

 Technology Driven Workplace

The shift to the learning organization goes hand-in-

hand with the current transition to a technology-
driven workplace.
– Employees are being connected electronically, and may
work in virtual teams, across borders & time zones.
– Machines have taken over routine tasks, freeing workers
to use their minds, to focus on opportunities, which
require flexibility & creativity.
– Exponential growth of computational power have made
impossible tasks, possible, fast and accurate.

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 Summary

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 Summary
• Four well-established schools of management thought:
1. The Classical Approach (one best way)
• Scientific management:
– Frederick W. Taylor (task based procedures, redesigned shovels),
– Frank and Lillian Gilbreth (job motions in standardization, studied bricklayers)
– Henry Gantt (Gantt charts for project tracking)
• Bureaucratic management
– Max Weber (A formal organizational structure with hierarchy, rules & regulations and division of labor)
• Administrative management
• Henri Fayol (Fayol’s 14 Principles of Management)

2. The Behavioral Approach

• Mary Parker Follet (ethics, power, leadership and participative decision making)
• Chester Barnard (Acceptance theory of Authority)
• Elton Mayo (Hawthorne studies)
• Abraham Maslow (Maslow's Hierarchy of Needs)
• Douglas McGregor (Theory X and Theory Y)
 Summary
3. The Quantitative Approach
• Management science & Operations management (computer modeling & simulations,
Mathematical forecasting)

4. The Modern Approaches To Management

• The Systems Theory (open system with inter-related inputs, transformational processes, output
and feedback)
• Contingency Theory (flexible approach, draw on a variety of theories & experiences, and
evaluate many options)
• Theory Z
– William Ouchi - increasing employee loyalty to the company by providing a job for life
with a strong focus on the well-being of the employee)
• Total Quality management
– W. Edwards Deming (foundations of Continuous Improvement. Cycle of Plan, Do, Check
& Act.)
– Joseph Moses Juran (TQM begins at the top of an organization and works its way down.)
– Philip "Phil" Crosby (initiated the Zero Defects).
The End