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The Evolution of Management Theory

Theories of Management
Management Theory

Classical Theories

Behavioural Theories

Quantitative Theories

Contemporary Theories

Scientific Management

Behaviourist Theories

Management Science

Systems Theory

Bureaucratic Management

Hawthorne Studies

Operations Management

Contingency Theory

Administrative Management

Human Relations

Management Information Systems

Emerging Views

Behavioural Science

Theories of Management
CLASSIC AL
Management Theory

THEORI ES SCIENTI FIC


MANAG EMENT

Classical Theories

Behavioural Theories

Quantitative Theories

Contemporary Theories

Scientific Management

Behaviourist Theories

Management Science

Systems Theory

Bureaucratic Management

Hawthorne Studies

Operations Management

Contingency Theory

Administrative Management

Human Relations

Management Information Systems

Emerging Views

Behavioural Science

Frederick Taylor
Developed the specific principles of Scientific Management Scientific Management
The systematic study of the relationships between people and tasks for the purpose of redesigning the work process for higher efficiency.
Defined by Frederick Taylor in the late 1800s to replace informal rule of thumb knowledge. Taylor sought to reduce the time a worker spent on each task by optimizing the way the task was done.

Taylors 4 Principles of Scientific Management


Scientifically study each part of a task and
develop the best method for performing the task

Carefully select workers and train them to

perform the task by using the scientifically developed method

Taylors 4 Principles of Scientific Management


Cooperate fully with workers to ensure
that they use the proper method

Divide work and responsibility so that

management is responsible for planning work methods using scientific principles and workers are responsible for executing the work accordingly

Problems with Scientific Management


Managers frequently implemented only the increased
output side of Taylors plan.
Workers did not share in the increased output.

Specialized jobs became very boring, dull.


Workers ended up distrusting the Scientific Management method.

Workers could purposely under-perform.


Management responded with increased use of machines and conveyors belts.

Administrative Management Theory


Administrative Management
The study of how to create an organizational structure that leads to high efficiency and effectiveness.

Max Weber
Developed the concept of bureaucracy as a formal system of organization and administration designed to ensure efficiency and effectiveness.

Webers Principles of Bureaucracy

Figure 2.2

Webers Five Principles of Bureaucracy


Authority is the power to hold people

accountable for their actions. Positions in the firm should be held based on performance, not social contacts. Position duties are clearly identified so that people know what is expected of them. Lines of authority should be clearly identified such that workers know who reports to who. Rules, standard operating procedures (SOPs), and norms guide the firms operations.

Fayols Principles of Management


Division of Labor: allows for job
specialization.
Fayol noted jobs can have too much specialization leading to poor quality and worker dissatisfaction.

Authority and Responsibility


Fayol included both formal and informal authority resulting from special expertise.

Unity of Command
Employees should have only one boss.

Fayols Principles of Management (contd)


Line of Authority
A clear chain of command from top to bottom of the firm.

Centralization
The degree to which authority rests at the top of the organization.

Unity of Direction
A single plan of action to guide the organization.

Fayols Principles of Management (contd)

Equity
The provision of justice and the fair and impartial treatment of all employees.

Order
The arrangement of employees where they will be of the most value to the organization and to provide career opportunities.

Initiative
The fostering of creativity and innovation by encouraging employees to act on their own.

Fayols Principles of Management (contd)


Discipline
Obedient, applied, respectful employees are necessary for the organization to function.

Remuneration of Personnel
An equitable uniform payment system that motivates contributes to organizational success.

Stability of Tenure of Personnel


Long-term employment is important for the development of skills that improve the organizations performance.

Fayols Principles of Management (contd)


Subordination of Individual Interest to the
Common Interest
The interest of the organization takes precedence over that of the individual employee.

Esprit de corps
Comradeship, shared enthusiasm foster devotion to the common cause (organization).

Theories of Management
Management Theory

BEHAVIO URAL THEORIE S

Classical Theories

Behavioural Theories

Quantitative Theories

Contemporary Theories

Scientific Management

Behaviourist Theories

Management Science

Systems Theory

Bureaucratic Management

Hawthorne Studies

Operations Management

Contingency Theory

HAWTHO RNE

Administrative Management

Human Relations

STUDIES
Behavioural Science

Management Information Systems

Emerging Views

Behavioural Theories
Emphasise the importance of attempting to understand the various factors that affect human behaviour in organisations.

The Hawthorne Studies


A group of studies conducted at the Hawthorne plant of the Western Electric Company during the late 1920s and early 1930s

Hawthorne Studies

Researchers monitored the productivity of five women who assembled electrical relays for several years.

Theories of Management
Management Theory

Classical Theories

BEHAVIOURAL Behavioural Quantitative


Theories Theories

Contemporary Theories

THEORIES
Scientific Management Behaviourist Theories Management Science Systems Theory

Bureaucratic Management

Hawthorne Studies

Operations Management

Contingency Theory

HUMAN RELATI ONS

Administrative Management

Human Relations

Management Information Systems

Emerging Views

Behavioural Science

Maslows Hierarchy of Needs

Self
Actualisation

Self
Esteem

Social Needs

Safety & Security Needs Basic Needs

Theory X & Theory Y


Theory X
The average person dislikes work and will try

to avoid it. Most people need to be coerced, controlled, directed, and threatened with punishment to get them to work towards organisational goals. The average person WANTS to be directed, shuns responsibility, has little ambition, and seeks security above all.

Theory X & Theory Y


Theory Y
Most people do not inherently dislike work; it

is seen as natural as recreation and rest. People will exercise self-direction and selfcontrol to reach goals to which they are committed. Commitment to goals is a function of the rewards available; particularly esteem and self-actualisation needs.

Theory X & Theory Y


Theory Y
When conditions are favourable, the average
person learns not only to accept responsibility, but also to seek it. Many people have the capacity to exercise a high degree of creativity and innovation in solving organisation problems. The intellectual potential of most individuals is only partially utilised in most organisations.

Theories of Management
Management Theory

Classical Theories

Behavioural Theories

QUANTITATIVE Quantitative Contemporary


Theories Theories

THEORIES
Scientific Management Behaviourist Theories Management Science Systems Theory

Bureaucratic Management

Hawthorne Studies

Operations Management

Contingency Theory

Administrative Management

MANAGEMENT Management Emerging Information INFORMATION Views Systems SYSTEMS Behavioural


Human Relations Science

Management Information Systems


Focuses on designing and implementing computer-based information systems for use by management. These systems turn raw data into information that is useful to various levels of management.

Theories of Management
Management Theory
Contemporary CONTEMPORARY Theories

Classical Theories

Behavioural Theories

Quantitative Theories

THEORIES
Scientific Management Behaviourist Theories Management Science

SYSTEMS
Contingency Theory

Systems Theory

Bureaucratic Management

Hawthorne Studies

Operations Management

THEORY

Administrative Management

Human Relations

Management Information Systems

Emerging Views

Behavioural Science

Systems Theory
Based on the idea that organisations can be visualised as systems System A set of interrelated parts that operate as a whole in pursuit of common goals

Systems Theory
Developed through the sciences of Biology and Physical Science

Resources Human Materials Equipment Finance Information

Abilities Planning Organising Leading Control Technology

Outcomes Products Services Profit & Losses Employee Growth & Satisfaction

Inputs

Transformation Processes

Outputs

Feedback from Environment

Open vs. Closed Systems


Closed System A system that does little or no interacting with its environment and receives little feedback Open System A system that operates in continual interaction with its environment

Theories of Management
Management Theory
Contemporary CONTEMPORARY Theories

Classical Theories

Behavioural Theories

Quantitative Theories

THEORIES
Scientific Management Behaviourist Theories Management Science Systems Theory

Bureaucratic Management

Hawthorne Studies

Operations Management

CONTINGENCY Contingency
Theory

THEORY
Administrative Management Human Relations Management Information Systems Emerging Views

Behavioural Science

Contingency Theory
A viewpoint that argues that appropriate managerial action depends on the circumstances of the situation. In other words ..

there is no single right way to manage

Contingency Theory
Contingency View Appropriate managerial action depends on situation

Situation A

Universal Management Principals

Situation C

Situation B

Contingency Theory