EVOLUTION OF MANAGEMENT

THOUGHT
CHAPTER 2

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 PRACTICE MCQ’s

• ________ is not one of the 6 M’s of

Management
❑Money
❑Material
❑Might
❑Method

Ans: Might

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 PRACTICE MCQ’s

• What does C stand for in VUCA?

❑Category
❑Catalyst
❑Complete
❑Complex

Ans: Complex

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 History of Management

• The history of management can be traced back to 5000 B.C. when the agriculture
revolution was at the initial stage.

• In Egypt, in 2900 B.C., the pyramids were built in a highly organised and
coordinated manner.

• Management was also a part of the Roman Empire, which organised its general
administration and controlled its political, military and judgmental issues by
using effective communication.

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https://www.youtube.com/watch?v=fz
MljshWTCU

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 History of Management
Industrial Revolution
Industrial revolution was a period of transition from manual production methods to
new manufacturing processes in the late eighteenth century. During industrial
revolution, management was based on two main propositions, which are:

• Firstly, labour was perceived as a bunch of lethargic people who would work only
when controlled and supervised.

• Secondly, labour was the only factor that could bring reduction in costs.
Therefore, all the efforts were made to reduce labour costs and increase
production.

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 History of Management

Industrial Revolution
There were many characteristics of industrial revolution. Some of the important
characteristics are:

Specialisation

Standardisation

Synchronisation

Maximisation

Centralisation

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 History of Management

Industrial Revolution
Let us discuss the characteristics:

• Specialization: During industrial revolution, the principle of division of labour was

followed wherein each worker was allotted a particular job with the purpose of
achieving specialization in that job.

• Standardization: During the industrial revolution, the main focus was laid on
standardization wherein identical products were produced in huge quantities.

• Synchronisation: It refers to the blending of all different elements at one place.

• Maximization: Here, it refers to the maximization of production.

• Centralisation: Centralisation means that all controlling powers lie in the hands of
top management.

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https://www.youtube.com/watch?v=X
h_Lk7kDrUI

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 History of Management

Forces Behind Management Thoughts

Political
Forces

Forces
Affecting
Management
Economic Thoughts
Forces Social Forces

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 History of Management

Forces Behind Management Thoughts

Let us study these forces.

• Political forces: Political forces, such as government regulations, political

institutions, and trade policies affect in the areas of environmental analysis,
organizational design and structure, and employee rights.

• Social forces: These forces can be in the form of social norms arising from the
values and beliefs of people in a society.

• Economic forces: These forces are responsible for the formation of base market
economy and other concepts, such as private ownership of property, economic
freedom, and competitive markets.

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Chap 2-Evolution of Management
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https://www.youtube.com/watch?v=d
TzSkz9yrWo

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 Approaches to Management

Classical Approach

Scientific Management

Administrative Management

Bureaucratic Management

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Classical Approach to Management

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 Approaches to Management

Classical Approach
These approaches are discussed as follows:

• Scientific Management: The scientific management approach was developed by

Frederick Winslow Taylor (1856-1915), who was an American engineer. Thus,
scientific management is also popular by the name of Taylorism.

• Administrative Management: Henry Fayol (1841-1925), a French mining

engineer, promoted the concept of administrative management. He focussed on
developing administrative principles that could be applicable to both general and
higher managerial levels.

• Bureaucratic Management: Bureaucratic management was promoted by Max

Webber (1864-1920), who was a German sociologist. According to Webber,
bureaucratic management is the most appropriate administration.

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 Important Aspects
• Work Planning
• Technical Requirements
• Principles of Management
• Formal Structure
• Assumption of Rational and Logical Behaviour

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 Merits
• Clarity in Hierarchy
• Clear Definition of Division of Labour
• Motivation by Money
• Decision Making by a Single Leader

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https://www.youtube.com/watch?v=k
Nrvxh8R1KU

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https://www.youtube.com/watch?v=a
mJ4xffO4gU

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Chap 2-Evolution of Management
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https://www.youtube.com/watch?v=a
Mwm2zq1KrI

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 BUREAUCRATIC APPROACH

❑ Key points:
➢ Management by standard rules
➢ Division of Labour
➢ Selection of Personnel
➢ Hierarchical Organization Structure
➢ Record of all administrative acts

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https://www.youtube.com/watch?v=fs
s0ALdXqII

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 Major Concepts of Scientific
Management
• Use scientific ways to break down the tasks of
each employee in smaller tasks
• Design tasks for employees in a scientific manner
and train them
• Use co-operation between employees and
management to perform tasks in a scientifically
designed manner
• Use division of labour to set up instructions and
design work between workers and managers
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 Principles of Scientific
Management Theory
• Replacement of the rule of thumb by development of
science for each part of men’s job
• Selection, training and development of workers in a
scientific manner
• Co-operation between management and workers or
harmony not discord
• Division of Responsibility
• Mental Revolution
• Maximum prosperity for employer and employees

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Criticism against the Theory

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 Worker’s Criticism
• Fast working speed of workers
• Loss of Individual workers creativity
• Issue of Monotony
• Increased Unemployment
• Weakening of Trade Unions
• Exploitation of Workers

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 Employer’s Criticism
• Heavy Investment
• Loss due to re-organization
• Not suitable for small scale firms

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https://www.youtube.com/watch?v=f
K4tyKvrj04

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https://www.youtube.com/watch?v=cJ
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Neo Classical Approach

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 George E. Mayo

• He is famous for his contribution in Hawthorne studies.

• Mayo was involved in the project in 1929 and 1930, and interviewed the workers
involved in the experiments.

• The outcome of his findings in Hawthorne studies later gave way for the human
relations movement. The movement focuses on the concept of job satisfaction,
group norms, and leadership quality and their significance in the improvement of
productivity.

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Neo Classical Approach-Elton Mayo
• A business organization is considered to be a social system
• The most important element of a social system is a Human
• An individual’s behaviour is dominated by his/her informal
group
• The significance of social and psychological factors in
deriving worker productivity and satisfaction was also
revealed
• The management should aim to develop Social, technical
and leadership skills of workers for their welfare
• The morale of employees and productivity in an
organization have a direct relation

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 Hawthorne's Experiments
1924-27: Experiments to determine the effects of
changes in illumination on productivity, illumination
experiments,
1927-28: Experiments to determine the effects of
changes in hours and other working conditions on
productivity, relay assembly test room experiments
1928-30:Conducting plant-wide interviews to determine
worker attitudes and sentiments, mass interviewing
programme
1931-32: Determination and analysis of social
organization at work, bank wiring observation room
experiments

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 Hawthorne's Experiments
Part I - Illumination Experiments (1924-27)
These experiments were performed to find out the effect of different levels of
illumination (lighting) on productivity of labour. The brightness of the light
was increased and decreased to find out the effect on the productivity of the
test group. Surprisingly, the productivity increased even when the level of
illumination was decreased. It was concluded that factors other than light
were also important.
Part II - Relay Assembly Test Room Study (1927-1928)
Under these test two small groups of six female telephone relay assemblers
were selected. Each group was kept in separate rooms. From time to time,
changes were made in working hours, rest periods, lunch breaks, etc. They
were allowed to choose their own rest periods and to give suggestions.
Output increased in both the control rooms. It was concluded that social
relationship among workers, participation in decision-making, etc. had a
greater effect on productivity than working conditions.

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 Hawthorne's Experiments
Part III - Mass Interviewing Programme (1928-1930)
21,000 employees were interviewed over a period of three years to
find out reasons for increased productivity. It was concluded that
productivity can be increased if workers are allowed to talk freely
about matters that are important to them.

Part IV - Bank Wiring Observation Room Experiment (1931-1932)

A group of 14 male workers in the bank wiring room were placed
under observation for six months. A worker's pay depended on the
performance of the group as a whole. The researchers thought that
the efficient workers would put pressure on the less efficient workers
to complete the work. However, it was found that the group
established its own standards of output, and social pressure was used
to achieve the standards of output.

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 Conclusions
• The conclusions derived from the Hawthorne Studies were
as follows :-
• The social and psychological factors are responsible for
workers' productivity and job satisfaction. Only good
physical working conditions are not enough to increase
productivity.
• The informal relations among workers influence the
workers' behaviour and performance more than the formal
relations in the organization.
• Employees will perform better if they are allowed to
participate in decision-making affecting their interests.
• Employees will also work more efficiently, when they
believe that the management is interested in their welfare.

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 Conclusions
• When employees are treated with respect and dignity,
their performance will improve.
• Financial incentives alone cannot increase the
performance. Social and Psychological needs must also
be satisfied in order to increase productivity.
• Good communication between the superiors and
subordinates can improve the relations and the
productivity of the subordinates.
• Special attention and freedom to express their views
will improve the performance of the workers.

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