Evolution of

Management
Thought
Introduction
Introduction
 Evolution Of Management Thought

➢ Classical Theory
➢ Neo classical Theory
➢ Modern Theory
Definition of classical approach

➢ Classical approach is the oldest formal

school of thought which began around
1900 and continued into the 1920s.
➢ Its ➢
mainly concerned with increasing the
efficiency of workers and organizations
based on management practices, which
were an outcome of careful observation.
➢ Classical approach mainly looks for the
universal principles of operation In the
striving for economic efficiency.
➢
Classical approach includes scientific.
Administrative & bureaucratic
management.
 classical Theory
o Scientific management
Administrative
o management
o Bureaucratic
management
 Scientific
management

F. W Taylor’s
contribution ( 1856 -
1915 )

o Scientific management focus on

workers and machine relationship.
o Organizational productivity can be
increased by increasing the efficiency
of production processes.
General
approach
criticism
 Contributions of Gilbreths
o Scientific management focuses on
one best way to do job.
o Includes both analysis and
sythesis.
o Includes necessary elements for
work.
o Introduced chart form of
representation.
 Administrative Management

Administrative management focuses on the managers and

the use or principles and functions for improving
organizational functioning. The administrative
management school treated management as a process to
get work done through and with people.
Henri Fayol, James D Mooney, Alan C. Reilly are the
pioneer contributors to administrative management.
 ➢ Classification of business
activities
Henri Fayol ➢ Basic functions of a managers
➢ Qualities and skills of a
Fayal's administrative
managers
management focuses on managers
➢ Principles of
and basic management functional.
management
 ▪ Technical activities
Classification of business
▪ Commercial activities
activities ▪ Financial activities
Fayol divided activities into following ▪ Security activities
six groups ▪ Accounting activities
▪ Managerial activities
 Basic functions of a Qualities and skills of
manager a manager
o Planning o Physical quality
Organising Mental quality
o Commanding o Moral education
Coordinating Special knowledge
o Controlling o Experience

o o

o o
Basic principles of management

o Division of work
Authority and responsibility
o Discipline
Unity of command
o Unity of direction
Remuneration
o Centralisation
Scalar chain
o Order
Equity
o Initiative

o
 Theory of authority structures
➢ Charismatic authority structure
➢ Traditional authority structure
➢ Rational legal authority structure
Charismatic authority structure

“Charismatic authority structure is a concept within sociology

and organizational theory that refers to a type of authority or
leadership based on the personal charisma and qualities of
an individual leader.”
It includes the following:
1- Charismatic Leader
2- Personal Appeal
3- Inspiration and Vision
4- Unconventional Behavior
5- Dynamic Communication
6- Emotional Connection
Traditional Authority Structure

“Traditional authority structure is a concept within

sociology and organizational theory that refers to a type of
authority or leadership based on long-standing customs,
cultural norms, and historical traditions.”

It includes the following:

1- Historical and Cultural Roots
2- Inherited Positions
3- Respect for Tradition
4- Stability and Continuity
5- Conservative Outlook
6- Hierarchy and Obedience
Rational-Legal Authority Structure

“Rational-legal authority structure is a concept within sociology

and organizational theory that refers to a type of authority or
leadership based on a system of rules, regulations, and legal
principles..”

It includes the following:

1- Legal Framework
2- Merit-Based
3- Bureaucratic Organization
4- Impersonal Nature
5- Specialization
6- Rule of Law
7- Formal Hierarchy
 BUREAUCRATIC MANAGEMENT

 Proposed by Max Weber in early 20th century.

 Rules and regulations to eliminate managerial
inconsistencies. 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. People should know what is
expected of them.
 Lines of authority should be clearly identified. Workers know who
reports to whom.
Bureaucratic
Principles
 Bureaucratic Principles

 Hierarchy: Characterized by a clear and well-defined hierarchy of authority.

 Division of work: Tasks are divided into specialized roles and responsibilities.
 Rules and Regulations: Rely heavily on formal rules, policies, and procedures to govern
their operations.
 Impersonal Relationships: Emphasis on impersonal and formal relationships among
employees.
 Meritocracy: Individuals are selected, promoted, and rewarded based on their skills,
qualifications, and performance rather than favouritism or nepotism.
 Record Keeping: Maintaining records and documentation to track activities and decisions.
 Specialization and Expertise: Value for expertise and specialization.
 Efficiency and Rationality: Aims for efficiency and rational decision-making by relying
on formal rules and standardized procedures.
Ranking organisations by Bureaucratic orientation

Highly Moderately Low

Bureaucratic Bureaucratic Bureaucratic
Organization Organization Organization
s s s
Manufacturing
Govt. Agencies Hospitals
Companies

Educational Non-Profit
MNCs
Institutions Organizations
 The coordinative principle
“The coordinative principle of management refers to the
concept of effectively and efficiently coordinating the
activities and efforts of individuals and departments
within an organization to achieve its goals and objectives.”

 Integration of Efforts
 Unity of Purpose
 Effective Communication
 Hierarchy and Structure
 Standardization
 Monitoring and Feedback
 Effective Leadership
 The Scalar Principle

The scalar principle, also known as the scalar chain or scalar process,
focuses on the hierarchical structure and the chain of authority
within an organization. It outlines the formal communication channels
and levels of authority that exist within an organization.
 Hierarchy
 Chain of Command
 Unity of Command
 Levels of Authority
 Communication Flow
 Accountability
 Span of Control
 Contribution of Classical Theory of Management

 Establishment of Management as a Discipline

 Emphasis on Efficiency and Productivity
 Division of Labor
 Division of Labor
 Principles of Management
 Bureaucratic Theory
 Focus on Systematic Approaches
 Measurement and Standardization
 Limitations of Classical Theory of Management

 Overemphasis on Efficiency
 Mechanistic and Bureaucratic
 Ignorance of Human Needs
 Lack of Flexibility
 Resistance to Change
 Top-Down Decision-Making
 Neoclassical
Theory
o Also known as “Behavioural science approach to modifying and improving the
classical theory”.
o Neoclassical theory gives importance to human and social aspects of the water
and his relations in the organization.

Elements of Neoclassical
✓ theory
✓ Hawthorne Experiment
✓ Human Relations Management
Behavioural science approach
 Hawthorne Experiment 4 phases of
o Conducted by Elton Mayo at Hawthorne
Hawthorne plant & general o Illumination Experiment (1924-1927)
Experiment
electronic company (GEC) Relay assembly room experiment
between1927 and 1932 at Chicago.
o (1924-1928)
o Objective of the experiment was to o Mass interviewing programme
find out the behaviour and altitude of (1928-1930)
workers at.
o Bank wiring room study (1931-
1932)
 Critiesms of
Hawthorne
o Lack experiment
validity
More importance to human
o aspects
o Emphasising on group decision
making
o It was not concluded scientifically
Over importance to freedom of
o workers
 Human Relation
Human Movement
relation is involving people in org in order to develop
team work which effectively fulfils their needs and achieve org goals.
Features are :
✓ Positive work environment
✓ Focus in on people
✓ Sound human relations
• Behavioural science approach
 Modern
Theory
Modern management has grown with the growth of social-
economics and scientific institution.

✓ Quantitative management approach

✓ Systematic approach
✓ Contingency management approach
 Quantitative
o Approach
Quantitative approach also called Operation Research
Scientific Method
o Decision Making
Major contributors in Quantitative approach are : Johan MacDonald,
o George R Terry, Andrew Szilagyi.
 Systematic
approach
✓ The system approach to management is essentially a way of thinking about
organizations and management problems
✓ From the system perspective management should focus on efficiency and
effectiveness in each part of the organization affect other parts of the
organization
 Advantages Disadvantages
o Abstract approach.
o Good basis of control.
Lack of universality.
Develops coordination on
o
o specialized activities.
o Efficient plan of action.
It concentrates on end results
o rather than means.
 C ontingency or situational
approach

▪ There cannot be a particular

management action which will be
suitable for all situations.
▪ The only action is designed on the
basis of external environment,
internal states and needs.
 Advantages Disadvantages
o Enables management to change o Inadequate literature.
employee roles to meet individual Complex.
needs. o Difficult empirical
o Reactive model of business
testing. Reactive not
management.
o proactive.

o
 Recent Developments in Management
Thought

➢ Total quality management (TQM)

➢ Search for excellence
 Search for
o A bias for action Excellence
Closeness
to the customer
o Autonomy and entrepreneurship
Productivity through people Hands
o on, value drive
Stick to knitting
o Simple form, learn staff Simultaneous
loose-tight properties
o Leadership-Management by
Wandering Around
o

o
Let us sum up