Republic of the Philippines

DEPARTMENT OF EDUCATION
Region I
SCHOOLS DIVISION OFFICE PANGASINAN II
Macayo Integrated School
Alcala, Pangasinan

Objectives:
1. Trace the evolution of management theories;
2. Enumerate and discuss the theories on management, and;
3. Differentiate management theories.

The Evolution of Management Theories

INTRODUCTION
Management skills have been utilized since ancient times, when tribal leaders organized hunting and gathering groups
to acquire resources from nature. The rise of civilizations had led leaders to organize communities and implement more complex
tasks such as: construction of infrastructures, the administration of governments, and even the conduct of war. The emergence
of capitalism during the 17th century inspired entrepreneurs to establish guiding principles and develop means to ensure the
success of any business venture. Theories and views regarding management soon developed and grew into an organized field
of study ideas are applied not only in business but also in other aspects of life.

The Development of Management

1. Ancient civilizations practiced management in organizing and implementing various activities vital to their communities. In
1100 BC, the Chinese used the four basic management functions of planning, organizing, leading, and controlling to carry out
vast infrastructure projects and manage that various parts of the expanding Chinese empire.

2.1 The Greeks developed a scientific approach to work, and the Greek philosophers Socrates and Plato discussed
management concepts such as leadership and job specialization.

2.2 The ancient Romans meanwhile practiced decentralized management to effectively manage their vast empire.

3. During the medieval period, Venetians improved production by standardizing the assembly line, using an inventory system,
and building warehouses. In the course of time, leaders and managers often utilized trial and error in dealing with management
problems before they could perfect operations.

4.1 The industrial Revolution of the 18 th century introduced great changes in management practices. The emphasis on
production brought about by improved industry generated a demand for new ways of ensuring efficiency and effectiveness in
factories and workplaces.

4.2 By 19th century, management has become an established discipline and many entrepreneurs and academics sought new
ideas and approaches in improving the workplace. Manufacturing and industry soon became a core business in Europe and the
United States, and many individuals sought to enter the commercial world.

5. By the 20th century, educational institutions were established to focus on the study of business and management. The first
business school in the United States, the Wharton School, was founded in Pennsylvania in 1881. In 1990, the Amos Tuck
School, was founded in New Hampshire and became distinguished as the first school to offer a master’s degree in business
administration.

6. The 20th century saw the development of modern management theories and innovative methods that transformed production
and led to the development of modern industry and commerce. Various entrepreneurs applied scientific principles in improving
the level of productivity of their respective businesses. Businessmen sought to establish the most efficient means of utilizing
resources and production processes to manufacture the greatest number of products in the shortest possible time.

SCIENTIFIC MANAGEMENT THEORY

It is a theory of management which studies the application studies the application of scientific methods and principles
for the purpose of redesigning the work process to increase efficiency. It emphasizes the importance of labor in the production
process and focuses on improving the efficiency of workers in production. Among its important advocates were Frederick W.
Taylor, Henry Gantt, and Frank and Lillian Gilbret h.

Frederick W. Taylor, an American engineer, was the first to advocate scientific management. He pioneered several
innovations during his tenure as foremen at Midvale Steel Company in Philadelphia. Taylor discussed in depth the scientific
management theory in his book “ The Principles of Scientific management” . He introduced the four principles of scientific
management as follows:
1. Replace the rule- of- thumb methods with those that are scientifically proven.
2. Select, train, and develop each worker based on scientific methods.
3. Cooperate with the workers to ensure that scientific methods are being observed and implemented in their work.
4. Divide work between managers and workers to ensure that the managers apply the scientific management principles in
planning the tasks and the workers apply the principles while performing these tasks.
 Taylor emphasizes efficiency in improving the production process. He believed that analyzing the work process will
enable the manager to identify the best way doing the job. Taylor is called the “Father of Scientific Management” because of his
contributions to the development of management.

Time and motion study- It is a technique wherein a job is divided into component parts and the time consumed in performing
each task is measured.

His ideas were also considered an important cornerstone of the Efficiency Movement, which improved industry and
production in Europe and the United States in the early 20 th century.

Henry Ford’s improvement of the assembly line. He was an industrialist who established the Ford Motor Company and
sold the first automobile- the Ford Model T.
1. Applied scientific principles in improving the process of assembling parts for the Model T.
2. Installed a moving assemble line where workers could concentrate on one task such as the installation of a specific
automobile.

Ford’s technique was so effective that it reduced the assembly time for the Model T from 13 hours to 1 ½ hours.

Limitations of the Model

1. Operations became routinary which led to boredom.
2. Money became the sole incentive for workers, ignoring other aspects of worker welfare.
3. Workers felt that the piece- rate technique, where they were paid only for the unit they produced regardless of time, might lead
managers to abuse power and exploit them.

ADMINISTRATIVE MANAGEMENT THEORY

Administrative management theory focuses on the overall management of an organization, emphasizing the role of
managers as administrators of the organizations. This was introduced in the early 20 th century by HENRI FAYOL, a French
industrialist.

The Five Functions of Management

1. Planning 3. Communicating 5. Controlling
2.Organizing 4. Coordinating

Fourteen Principles of Management

1. Division of work into specialized tasks, with specific duties and responsibilities given to individuals.
2. Authority of managers to delegate work and tasks to the employees. The employers, in turn, are expected to comply and
exercise their tasks responsibility.
3. Discipline where expectations should be clearly set and violators of rules must be punished.
4. Unity of command where an employee should only report to one supervisor.
5. Unity of direction which means that the efforts of the employees are guided toward the attainment of organizational objectives.
6. Predominance of the general interest of the organization over the individual interests of employees.
7. Remuneration of the efforts of the employees which should be systematically rewarded in line with the organization’s vision
and mission.
8. Centralization where the roles of all employees are classified, with emphasis on the distinction between superior and
subordinate roles.
9. Scalar chain which means that communication should be open within the chain of command.
10. Order where the organization of jobs and materials must be done in an orderly fashion.
11. Equity which means that fairness and order must be practiced to maintain employee commitment.
12. Stability and tenure of personnel to actively promote employee loyalty to the organization.
13. Initiative to encourage employees to act on their own in support of the organization’s objectives.
14. Esprit de corps to promote teamwork and the unity of interest between the employees and the management.

Max Weber, a German sociologist, contributed the development of administrative management through his studies on public
administration and bureaucracy. He believed that bureaucratic structures allow for specialization of skills and enable workers
with different traits, skills, and goals to work together and contribute toward performing a common task.

Other Contributors to the Development of the Administrative Management Theory

1. Chester Barnard, a former president of the New Jersey Telephone Co., wrote “ The functions of the Executive ”, which
highlights the major functions of the senior execute, namely:
a. to formulate the organization’s mission.
b. to hire key employees, and
c. to maintain organizational communication.

2. Mary Parker Follet- wrote “Dynamic Organization”, which emphasizes the ever- changing situations that managers have to
deal with. In particular, Follet recognized the human element in management and emphasized collaboration and mutual
cooperation in seeking solutions to problems.

Importance
a. The views on administrative acknowledged the need for flexibility among managers and for them to recognize various ways of
motivating groups and individuals.
b. It further improved management methods recognized management and business administration as significant and essential
professions along with law and medicine.

HUMANS RELATIONS THEORY

The human relation theory grew out of the human relations movement in the 1930s. It focuses on the social element in
the workplace and considers the influence of interpersonal relationships, social conditioning, and group norms in determining the
performance of workers.

The foundations of the human relations movement were established in the 1920s with the pioneering studies of Elton
Mayo, an Australian psychologist who used his expertise to implement improvements in the workplace. He and his colleagues
embarked on a series of studies on workers in the Hawthorne Works factory of the Western Electric Company.

INNOVATIVE OUTCOMES OF THE HAWTHORNE STUDIES

1. Introduction of a set of number of work hours.
2. The implementation of break time for workers.
3. Improvement of lighting in work areas.
4. Close supervision by managers.

Managers were encouraged to be supportive of their workers to actively involve them in management decisions. Mayo
observed that the introduction of these changes resulted in increased satisfaction among workers which also resulted in their
increased overall productivity.

Another noted contributor to the field of human relations is Abraham Maslow. Maslow argued that individual behavior is
primarily influenced by certain needs.

Maslow described these needs according to a hierarchy where people try to satisfy their lower- level or basic needs, such as
food, clothing, and shelter, and then progress upward to the highest- level needs such as self- esteem and self- actualization. In
1970, Maslow revised his original 1954 pyramid and added two more essential needs: cognitive needs or the need to acquire
knowledge; and aesthetic needs or the need to create and experience beauty, balance, and structure. The application of
Maslow’s theory in management requires managers to ensure that the essential needs of their workers are being met in the
workplace to guarantee their maximum performance.

QUANTITATIVE MANAGEMENT THEORY

Quantitative management uses quantitative approaches such as statistical analyses and computer simulations to arrive
at a management decision. The two main branches of quantitative management are management science and operations
management.

Management science uses mathematics in problem solving and decision making. It seeks to create ideal models that
will be the basis for improved business operations and processes. On the other hand, operations management seeks to apply
ideas and models from management science to the actual workplace in dealing with managerial situations.

Management Information System, is a most recent subfield of quantitative management. it gathers past, present, and
projected data from external and internal sources and transforms them into usable information which managers use to select the
best alternatives and make decisions easily. The information is usually provided in easily accessible formats such as
spreadsheets.

SYSTEMS THEORY

This theory explains how interrelated parts operate together to achieve a common purpose. With the advent of the
Industrial Revolution and the increasing requirement for increased efficiency and greater precision in production and operations,
the systems approach became the preferred model of business organization and management.
It defines an organization as a system which is composed of four elements:
1. Inputs (materials/ human resources)
2. Transformation process (technology/ managerial operations)
3. Outputs (products/ services)
4. Feedback (reactions from the environment)
An open system refers to an organization that interacts closely with environment and is fully aware of what is going on
in the environment as well as the changes it experiences.
An closed system does not interact with its environment and pays little attention to changes in its surroundings.

CONTINGENCY THEORY

The contingency theory argues that universal theories cannot be applied to organizations because each organization
has a unique characteristic and is confronted by varied problems or challenges. An organization’s performance is also affected
by internal and external factors.

FRED FIEDLER (1967)- proposed the contingency theory

- an industrial and organizational psychologist who studied the relationship between leadership and group
effectiveness
- Contingency model states that the personality of the leader determines how well he or she addresses situations in the
workplace.
OTHER EXPERTS
1. Paul Lawrence, Jay Lorsch, and James Thompson- studied the impact of contingency factors on the organizational structure.
- the structural contingency theory was the dominant paradigm of organizational structural theories for most of the
1970s.
- they suggested that previous theories such as Weber’s bureaucracy and Taylor’s scientific management failed
because they overlooked the fact that management style and organizational structure are influenced by various aspects of the
environment, which are the contingency factors that define business situations.
- Hence, one cannot determine the best style of leadership for an organization.
QUALITY MANAGEMENT THEORY
Quality management emphasizes consistency in an organization and minimal to no errors or defects in production.
This ensures quality products and services that result to high customer satisfaction and increased revenue. Managers and
employees are both closely involved in quality management.

WILLIAM EDWARDS DEMING

-conducted his work in the 1950s in post- war Japan, as he helped Japanese industries improve production.
- his methods involved Statistical Process Control (SPC) and problem- solving techniques.

SIGNIFICANT PRINCIPLES
1. improved product design 3. improved product testing
2. uniform product quality 4. increased market sales

JOSEPH MOSES JURAN

-he also worked with Japanese business and introduced his concept of quality management which emphasized training for top
and middle managers.
- In 1979, he established the Juran Institute which guided organizations in improving the quality of their products and services.
These efforts contributed toward making Japan an industrial power in Asia within a decade after the Second World War.

1986- The Japanese concept of KAIZEN was introduced which focuses on the continuous improvement of people, processes,
and products.

KAIZEN is a Japanese word which means “change for the better”, and requires the implementation of gradual changes in an
industry or organization over a certain period.
In the implementation of changes, all employees are involved, from the top management down to the office personnel,
factory workers, janitorial staff, and even external stakeholders.

The Japanese automotive manufacturer, TOYOTA, has been using kaizen to implement small improvements geared
toward overall improvement in production and operations.

HIGHLIGHTS

The SCIENTIFIC MANAGEMENT THEORY emphasized the application of scientific principles in improving labor efficiency.

The ADMINISTRATIVE MANAGEMENT THEORY focuses on the role of managers as administrators of the organization

The HUMAN RELATIONS THEORY focused on the social element in the workplace and encouraged managers to foster close
social relations with their workers.

The QUANTITATIVE MANAGEMENT THEORY uses quantitative approaches in arriving at management decisions

Management science applies mathematics in problem solving and decision- making.

Operations Management applies ideas and models to the actual workplace.

Management information systems organize and present data to aid managers in making decisions.

The SYSTEMS THEORY describes the organization as composed of various interrelated parts that work together to achieve a
common goal.

The CONTINGENCY THEORY considers the unique characteristics of managers, as well as the effect of environmental factors,
in addressing management problems and situations.

The QUALITY MANAGEMENT THEORY emphasizes consistency in an organization and the production of high- quality products
and services.

Reference:

Zarate, Cynthia A., Organization and Management for Senior High School, Quezon City: C & E Publishing, Inc., 2016 pp 12-23