Example Bank Week 3 (Historical Development of Management Thought 1)

1. Principles of Scientific Management

 In the McDonald’s example, the restaurants are designed for
and limited to the predetermined mix of products. There is no
space for any food items that were not designed into the
system. Thus, the employees have no discretion regarding
what they can sell, how to prepare and serve any item of food.
All of the food preparation and cooking processes are fixed and
restaurant managers are always around and can give
instructions and supervision to staff when needed.
 Using McDonald’s as an example, the consistent high standard
in the service of staff is achieved by careful selection and
training of staff. McDonald’s training program is designed to
make sure that the staff have the skills when it comes to food
preparation and service.
 At McDonald’s, restaurant managers oversee the overall
operations of the store, they make sure that all of the
ingredients and supplies needed are available. They monitor
the performance of the staff and during peak hours also pitch
in when required. By providing support and ensuring that all
the resources needed are available, the managers allow the
staff to focus on doing their jobs – preparing, cooking and
serving the food.
 In the case of McDonald’s, they have worked out the most
efficient way to prepare the food in the stores. Raw
hamburger patties are carefully pre-packed and pre-measured
and frozen. This ensures that they are of the same size and
weight. McDonald’s has also developed its cooking technology
so that the hamburgers are now being cooked on both sides at
the same time which not only achieves greater consistency in
the cooking process but also halves the time it takes to cook a
hamburger.

2. 14 Principles of Management
 In Avon Cosmetics, salespeople report under the sales manager who has recruited
them. They cannot take orders from other sales managers as it will be confusing if
they have more than one person to report to.
 At AGL, customer service representatives are allowed to make some decisions with
regards to customer requests, for example with regards to incorrect meter
readings that result in refunds of below $100. Customer service representatives
can suggest to customers that they can either get the amount credited in their
account or get it credited in their next bill. Either way the customer service
representative can get it processed without having to ask their supervisor.
 Workers in the Ford assembly line are assigned a small set of specific tasks as part
of the car manufacturing process. By completing these same tasks repeatedly, the
workers improve their ability and improve efficiency.
 Microsoft held a Build A Bike event where teams had to solve puzzles, decipher
codes and unlocked secrets in order to acquire the necessary parts to build a
bicycle. Challenges were encountered along the way and at the end the ultimate
conclusion was the understanding that each component of an organisation is
interdependent and can’t work apart from other parts of the organisation.
 Monash College has a rule which states that when an employee is sick, they need
to contact their team leader and file for sick leave. They need to then contact the
operations manager to make sure that someone else covers the teaching of the
absent employee.
 Apple uses a single strategic plan which is developed by top management and then
lower levels of management translate them to strategies in their respective
departments. Using only one plan makes sure that all the strategies are consistent
and aimed in achieving the same organisational goal.
 In a construction site, the foreman, who manages the site, needs to make sure that
the tiles needed for the bathrooms are available when they are needed. He needs
to make sure that there is enough number of tiles and that they are of the correct
size and colour.
 In large accounting firms like PWC and KPMG, employees are not allowed to take
leave during tax season to ensure that all hands are on deck to help with the
enormous workload.
 At Virgin, male employees are allowed to take 12 months fully paid paternity leave
when they have children, this allows time for the employees to get settled in their
new family arrangements before they resume work.
 At Monash College, teachers are paid different salaries based on their skills,
qualifications and experience.
 The production manager in Samsung can give orders to factory workers but not to
staff in other departments such as sales or accounting.
 Using a typical hotel organisation chart below, employees will be able to identify
their position in the organisation, who their immediate supervisor is and which
department they belong to, this allows the employees to understand the chain of
command in the organisation.


 The headmaster of a school needs to make his staff feel that their jobs are secure.
He needs to reduce staff turnover because recruitment and training of new staff
takes time and resources. If staff leave, the headmaster needs to find suitable
replacements to avoid remaining staff to carry the additional workload.
 Employees in 3M are allowed to apply for seed capital to develop their innovative
ideas and test their commercial potential. This fosters a spirit of creativity and
innovation in the employees.