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Organisational Theory

Organisational Theory

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Published by: Nazzir Hussain Hj Mydeen on Aug 19, 2009
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New York Institute of TechnologyDr. Stephen W. Hartman Management Theory
Introduction and Main Points
Civilization is the product of those who came before us. The evolution of modernmanagement thinking begins in the nineteenth century and flourished during thetwentieth. The twentieth century has witnessed a revolution in managementtheory ranging from classical theory to the Japanese management approach.Today's management theory is the result of the interdisciplinary efforts of manypeople.
The Founders
The beginning of the modern organization occurred primarily during the middle of the nineteenth century with the rise of the factory system, principally in the textileindustry, where automation and mass production became the cornerstone of productivity. Management thinking, however, was slow to evolve during thecentury. The need existed to define what management was in the first instance aswell as to operationalize it in meaningful terms for an organization. During thisperiod two principal management theorists took up this challenge and emergedas the so-called Pre-Classicists of management thought.
In the nineteenth century, Robert Owen and Charles Babbage seriouslyaddressed the quest for the development of management theory. Owen was anentrepreneur and social reformer while Babbage was a noted mathematician witha strong managerial interest.
Robert Owen (1771-1858)
Robert Owen's ideas stemmed from his ownership of a cotton mill in New Lanark,Scotland where he developed a strong interest in the welfare of the 400 to 500child employees. Owen spearheaded a legislative movement to limit childemployment to those over the age of ten while reducing the workday to 10 1/2hours.In 1813 Owen published a pamphlet,
 A New View of Society 
, where he describedhis vision of society. He also became active in improving living conditions of 
employees through the implementation of improvements in housing, sanitation,public works and establishing schools for the children. Owen strongly believesthat character is a product of circumstances and that environment and earlyeducation is critical in forming good character. While being extremelycontroversial during his lifetime, Owen is credited with being the forerunner of the modern human relations school of management.
Charles Babbage (1792-1871)
Charles Babbage, a noted English mathematician, is credited as being the "father of the modern computer" for performing the fundamental research for the firstpractical mechanical calculator as well as doing basic research and developmenton an "analytical engine" acknowledged to be the forerunner of today's moderncomputer. His interest in management stemmed largely from his concerns withwork specialization or the degree to which work is divided into its parts. This isnow recognized as being the forerunner of contemporary operations research.Babbage's other major management contribution came from the development of amodern profit-sharing plan including an employee bonus for useful suggestionsas well as a share of the company's profits.While both Owen and Babbage were important nineteenth century managementinnovators, their efforts lacked the central tenets of a theory of management.Owen was primarily credited with making specific suggestions regardingmanagement techniques in the areas of human relations while Babbage iscredited with developing the concepts of specialization of labor and profitsharing. These pre-classicists paved the way for the theoretical ferment of theclassical school of management.
The Classical School 
The twentieth century witnessed a period of tremendous management theoryferment and activity. Calls were heard for the development of a comprehensivemanagement theory. The classical school of management was primarilyconcerned with developing such a theory to improve management effectivenessin organizations.However, the classical school theorists went a step further. Not only did they seekto develop a comprehensive theory of management, but they also wanted toprovide the tools a manager required for dealing with their organizationalchallenges. Within the classical school there are the bureaucratic management,administrative management and scientific management branches.
Bureaucratic Management 
Max Weber can be classified in the bureaucratic management branch of theclassical school. Weber, the son of a prominent Bismarckian era Germanpolitician, was raised in Berlin and studied law at the University of Berlin. After assuming an appointment teaching law at the University of Berlin, Weber assumed teaching appointments in economics at the Universities of Freiburg,Heidelberg, Vienna, ending with his death after a bout with pneumonia at theUniversity of Munich.Weber's interest in organizations evolves from his view of the institutionalizationof power and authority in the modern Western world. He constructed a "rational-legal authority" model of an ideal type bureaucracy. This ideal type rested on abelief in the "legality" of patterns of normative rules and the right of thoseelevated to authority to issue commands (legal authority). Weber postulated therules and regulations of a bureaucracy serve to insulate its members against thepossibility of personal favoritism.
Max Weber (1864-1920)
Weber believes all bureaucracies have certain characteristics:1. A well defined hierarchy. All positions within a bureaucracy are structured in away permitting the higher positions to supervise and control the lower positions.This provides a clear chain of command facilitating control and order throughoutthe organization.2. Division of labor and specialization. All responsibilities in an organization arerationalized to the point where each employee will have the necessary expertiseto master a particular task. This necessitates granting each employee therequisite authority to complete all such tasks.

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