Week 2 History of Management

Management
Fourteenth Edition
Chapter MH-1
Management History Module
Copyright © 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved
Learning Objectives
MH1.1 Describe some early management examples.
MH1.2 Explain the various theories in the classical
approach.
MH1.3 Discuss the development and uses of the behavioral
approach.
MH1.4 Describe the quantitative approach.
MH1.5 Explain various theories in the contemporary
approach.
Early Management
• The Egyptian pyramids and the Great Wall of
China are proof that projects of tremendous
scope, employing tens of thousands of people,
were completed in ancient times.
• Who told each worker what to do? Who ensured
there would be enough stones at the site to keep
workers busy? The answer is managers
The Historical Context of Management
D Greeks
C Babylonians G Venetians
B Egyptians E Romans
A Sumerians F Chinese
3000 B.C. 2500 B.C. 2000 B.C. 1500 B.C. 1000 B.C. 500 B.C. A.D.500 A.D.1000 A.D.1500
A Used written rules and regulations for governance E Used organized structure for communication and control
B Used management practices to construct pyramids F Used extensive organization structure for government
agencies and the arts
C Used extensive set of laws and policies for governance
G Used organization design and planning concepts to
D Used different governing systems for cities and state
control the seas
© 2016 Cengage Learning. All rights reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–4
Job Specialization
• In 1776 Adam Smith published “The Wealth of
Nations”
– division of labor (job specialization): the
breakdown of jobs into narrow and repetitive
tasks
– 10 persons produced 48.000 pins/day when
work with specialization
– When each person worked alone performing
each task separately, it would be quite an
accomplishment to produce even 10 pins a day
Industrial Revolution
• Industrial revolution: a period during the late
eighteenth century when machine power was
substituted for human power, making it more
economical to manufacture goods in factories than
at home
• These large efficient factories needed someone to
forecast demand, ensure that enough material
was on hand to make products, assign tasks to
people, direct daily activities, and so forth.
Early Management Pioneers
• Robert Owen (1771–1858)

–Recognized the importance of human resources and
the welfare of workers.
• Charles Babbage (1792–1871)
–Focused on creating production efficiencies through
division of labor, and application of mathematics to
management problems.
Exhibit MH-1
Major Approaches to Management
Exhibit MH-1 shows the four major approaches to management theory: classical,
behavioral, quantitative, and contemporary.
Evolution of Management
Classical Approach
• Classical approach: the first studies of
management, which emphasized rationality and
making organizations and workers as efficient as
possible
• Consist of:
– Scientific management: Frederick W Taylor;
Frank & Lilian Gilbreth
– General Administrative: Henri Fayol & Max
Weber
Scientific Management
• 1911 Principles Of Scientific Management
• Scientific management: an approach that involves using
the scientific method to find the “one best way” for a job to be
done
• Taylor observed:
– Employees used vastly different techniques to do the same
job.
– They often “took it easy” on the job,
– and Taylor believed that worker output was only about one-
third of what was possible.
– Virtually no work standards existed, and workers were placed
in jobs with little or no concern for matching their abilities and
aptitudes with the tasks they were required to do.
– Taylor set out to remedy that by applying the scientific method
to shop-floor jobs.
Exhibit MH-2
Taylor’s Scientific Management Principles
Principles
1. Develop a science for each element of an individual’s work to replace the old
rule-of-thumb method.
2. Scientifically select and then train, teach, and develop the worker.
3. Heartily cooperate with the workers to ensure that all work is done in
accordance with the principles of the science that has been developed.
4. Divide work and responsibility almost equally between management and

workers. Management does all work for which it is better suited than the workers.
Frank and Lillian Gilbreth
• Frank is probably best known for his bricklaying experiments.
• By carefully analyzing the bricklayer’s job, he reduced the
number of motions in laying exterior brick from 18 to about 5,
and in laying interior brick from 18 to 2.
• Using Gilbreth’s techniques, a bricklayer was more productive
and less fatigued at the end of the day.
• The Gilbreths invented a device called a microchronometer that
recorded a worker’s hand-and-body motions and the amount of
time spent doing each motion. Wasted motions missed by the
naked eye could be identified and eliminated.
• The Gilbreths also devised a classification scheme to label 17
basic hand motions (such as search, grasp, hold), which they
called therbligs
Characteristics of Scientific Management
14
Classical Management Perspective
• Contributions • Limitations
– Laid foundation for later – More appropriate for
developments. use in traditional,
– Identified important stable, simple
management organizations.
processes, functions, – Prescribed universal
and skills. procedures that are not
– Focused attention on appropriate in some
management as settings.
subject of scientific – Employees viewed as
inquiry. tools rather than as
resources.
General Administrative Theory
• General administrative theory: an approach to
management that focuses on describing what
managers do and what constitutes good
management practice
Henri Fayol
• Principles of management: fundamental rules of
management that could be applied in all
organizational situations and taught in schools
• Focused on the entire organization
• Henri Fayol, a French mining engineer, was a
major contributor
• 14 general principles of management; many still
used today
• He first identified five functions that managers
perform: planning, organizing, commanding,
coordinating, and controlling
Exhibit MH-3: Fayol’s 14 Principles of Management
(1 of 2)
Principles
1. Division of work. Specialization increases output by making employees more
efficient.
2. Authority. Managers must be able to give orders, and authority gives them this
right.
3. Discipline. Employees must obey and respect the rules that govern the
organization.
4. Unity of command. Every employee should receive orders from only one superior.
5. Unity of direction. The organization should have a single plan of action to guide
managers and workers.
6. Subordination of individual interests to the general interest. The interests of
any one employee or group of employees should not take precedence over the
interests of the organization as a whole.
7. Remuneration. Workers must be paid a fair wage for their services.
Exhibit MH-3: Fayol’s 14 Principles of Management
(2 of 2)
Principles
8. Centralization. This term refers to the degree to which subordinates are
involved in decision making.
9. Scalar chain. The line of authority from top management to the lowest ranks
is the scalar chain.
10. Order. People and materials should be in the right place at the right time.
11. Equity. Managers should be kind and fair to their subordinates.
12. Stability of tenure of personnel. Management should provide orderly
personnel planning and ensure that replacements are available to fill
vacancies.
13. Initiative. Employees allowed to originate and carry out plans will exert high
levels of effort.
14. Esprit de corps. Promoting team spirit will build harmony and unity within
the organization.
Max Weber
• Max Weber, a German sociologist, introduced the
concepts
• Manage organizations on impersonal, rational
basis
• Organization depends on rules and records
• Bureaucracy: a form of organization characterized
by division of labor, a clearly defined hierarchy,
detailed rules and regulations, and impersonal
relationships
• Managers use power instead of personality to
delegate
Although important productivity gains
come from this foundation, bureaucracy
hasCopyright
taken on a negative tone
© 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved
Behavioral Approach
• Managers get things done by working with people.
• This explains why some writers have chosen to
look at management by focusing on the
organization’s people.
• The field of study that researches the actions
(behavior) of people at work is called
organizational behavior (OB).
• Much of what managers do today when managing
people—motivating, leading, building trust,
working with a team, managing conflict, and so
forth—has come out of OB research.
Hawthorne Studies
• Hawthorne studies: a series of studies during the 1920s
and 1930s that provided new insights into individual and
group behavior
• Conducted at Western Electric
– Illumination study: Lighting adjustments affected both
control and experimental groups of employees.
• Conclusion:
– people’s behavior and attitudes are closely related,
– that group factors significantly affect individual behavior,
– that group standards establish individual worker output,
– and that money is less a factor in determining output
than group standards, group attitudes, and security.
– These conclusions led to a new emphasis on the human
behavior factor in the management of organizations
Behavioral Management Contributions
• Provided insights into motivation, group

dynamics, and other interpersonal processes.
• Focused managerial attention on these critical
processes.
• Challenged the view that employees are tools.
• Furthered the belief that employees are valuable
resources.
Behavioral Management Limitations
• Complexity of individuals makes behavior

difficult to predict.
• Many concepts not put to use because
managers are reluctant to adopt them.
• Practicing managers do not always accept or
understand the importance of behavioral
processes and that employees are valuable
resources rather than simple tools.
Quantitative Approach
• Quantitative approach: the use of quantitative techniques to
improve decision-making also is known as management
science, evolved from mathematical and statistical techniques
• Quantitative Management
– Helped Allied forces manage logistical problems during
World War II.
– Focuses on decision making, economic effectiveness,
mathematical models, and use of computers to solve
quantitative problems.
• Management Science
– Focuses on the development of representative
mathematical models to assist with decisions.
• Operations Management
– Practical application of management science to efficiently
manage the production and distribution
of products and services
Quantitative Management Contributions
• Developed sophisticated
quantitative techniques to
assist in decision making.
–Models are useful in
understanding complex
processes and situations.
• Useful in planning and
controlling processes.
Quantitative Management Limitations
• Cannot fully explain or predict

behavior of people in organizations.
• Mathematical sophistication may
displace other managerial skills.
• Uses models that may require
unrealistic or unfounded
assumptions, limiting their general
applicability.
Total Quality Management
• A quality revolution swept through both the business and
public sectors in the 1980s and 1990s.
• Inspired by quality experts, the most famous being W.
Edwards Deming and Joseph M. Juran.
• Advocated in the 1950s with few supporters in the US but
were enthusiastically embraced by Japanese
organizations.
• As Japanese manufacturers began beating U.S.
competitors in quality comparisons, however, Western
managers soon took a more serious look at Deming’s and
Juran’s ideas, which became the basis for today’s quality
management programs.
• Total quality management (TQM): a philosophy of
management that is driven by continuous improvement
and responsiveness to customer needs and expectations
Exhibit MH-6: What is Quality Management?
Characteristic
1. Intense focus on the customer. The customer includes outsiders who buy the
organization’s products or services and internal customers who interact with and serve others
in the organization.
2. Concern for continual improvement. Quality management is a commitment to never
being satisfied. “Very good” is not good enough. Quality can always be improved.
3. Process focused. Quality management focuses on work processes as the quality of
goods and services is continually improved.
4. Improvement in the quality of everything the organization does. This relates to the
final product, how the organization handles deliveries, how rapidly it responds to complaints,
how politely the phones are answered, and the like.
5. Accurate measurement. Quality management uses statistical techniques to measure
every critical variable in the organization’s operations. These are compared against standards
to identify problems, trace them to their roots, and eliminate their causes.
6. Empowerment of employees. Quality management involves the people on the line in the
improvement process. Teams are widely used in quality management programs as
empowerment vehicles for finding and solving problems.
Contemporary Approaches
• Starting in the 1960s, management researchers began to
look at what was happening in the external environment
outside the boundaries of the organization.
• Two contemporary management perspectives—systems
and contingency—are part of this approach.
• Systems theory is a basic theory in the physical sciences,
but had never been applied to organized human efforts.
• In 1938, Chester Barnard, a telephone company executive,
first wrote in his book, The Functions of an Executive, that
an organization functioned as a cooperative system.
• However, it wasn’t until the 1960s that management
researchers began to look more carefully at systems
theory and how itCopyright
related to organizations.
© 2018, 2016, 2014 Pearson Education, Inc. All Rights Reserved
Systems Thinking
• The ability to see the distinct elements of a situation as well
as the complexities
• System: a set of interrelated and interdependent parts
arranged in a manner that produces a unified whole
• Subsystems – are parts of the system that are all
interconnected
• Closed systems: systems that are not influenced by and do
not interact with their environment
• Open systems: systems that interact with their environment
• Synergy – the whole is greater than the sum of its parts
• Entropy
– Is a process in which an organizational system declines
due to failing to adjust to change in its environment.
– Is avoided through change and renewal.
Managers must understand subsystem interdependence
and synergy
Exhibit MH-7
Organization as an Open System
Exhibit MH-7 shows a diagram of an organization from an open systems perspective.

Contingency Approach
• Universal Perspectives
– Include classical, behavioral, and quantitative
approaches.
– Attempt to identify “one best way” to manage
organizations.
• Contingency Perspective
– Suggests each organization is unique.
§ Appropriate managerial behavior
depends (is contingent) on current
situation in the organization.
• Contingency approach: a management approach
that recognizes organizations as different, which
means they face different situations (contingencies)
and require different ways of managing
Exhibit MH-8: Popular Contingency Variables
Variable
Organization Size. As size increases, so do the problems of coordination. For in-
stance, the type of organization structure appropriate for an organization of 50,000
employees is likely to be inefficient for an organization of 50 employees.
Routineness of Task Technology. To achieve its purpose, an organization uses
technology. Routine technologies require organizational structures, leadership
styles, and control systems that differ from those required by customized or
nonroutine technologies.
Environmental Uncertainty. The degree of uncertainty caused by environmental
changes influences the management process. What works best in a stable and
predictable environment may be totally inappropriate in a rapidly changing and
unpredictable environment.
Individual Differences. Individuals differ in terms of their desire for growth,
autonomy, tolerance of ambiguity, and expectations. These and other individual
differences are particularly important when managers select motivation techniques,
leadership styles, and job designs.
The Contingency Perspective Process
Problem or Situation
Important
Contingencies
Solution or Action Solution or Action Solution or Action

A B C
Contemporary Management
Issues and Challenges
• Globalization of product and service markets
• An increasingly diverse and globalized workforce
• Increased emphasis on ethics and social responsibility
• The use of quality as the basis for competition
• The shift to a predominately service-based economy
• Meeting the challenges of a recovering economy
• Creating new organizational structures to provide
challenging, motivating, and flexible work environments
• The effects of new information technology on how work
is done in organization
An Integrative Framework of
Management Perspectives
Systems Approach Contingency Perspective
• Recognition of internal • Recognition of the situational
interdependencies nature of management
• Recognition of • Response to particular
environmental influences characteristics of situation
Classical Behavioral Quantitative

Management Management Management
Perspectives Perspectives Perspectives
Methods for Insights for moti- Techniques for
enhancing vating performance improving decision
efficiency and and understanding making, resource
facilitating planning, individual behavior, allocation, and
organizing, and groups and teams, operations
controlling and leadership
Effective and efficient management
Review Learning Objective MH1.1
• Describe some early management examples.
– Early examples of management practice include the
construction of the Egyptian pyramids and the Great
Wall of China.
– One important historical event was the publication of
Adam Smith’s “Wealth of Nations,” in which he argued
the benefits of division of labor (job specialization).
– Another was the industrial revolution, where it became
more economical to manufacture in factories than at
home.
• Explain the various theories in the classical
approach.
– Frederick W. Taylor
– The Gilbreths
– Henri Fayol
– Max Weber
• Discuss the development and uses of the
behavioral approach.
– Early advocates of OB
– The Hawthorne Studies
• Describe the quantitative approach.
– The quantitative approach
– Total quality management (TQM)
• Explain various theories in the contemporary
approach.
– Systems approach
– Contingency approach
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Week 2 History of Management

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Management

• Robert Owen (1771–1858)

4. Divide work and responsibility almost equally between management and

• Provided insights into motivation, group

• Complexity of individuals makes behavior

• Cannot fully explain or predict

Exhibit MH-7 shows a diagram of an organization from an open systems perspective.

Solution or Action Solution or Action Solution or Action

Classical Behavioral Quantitative

Effective and efficient management

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