CHAPTER TWO

EVOLUTION OF MANAGEMENT
Management Schools of Thought

 Quantitative Approach
 Systems Approach
 Contingency Approach
 Pre-Classical Contributors
Robert Owen (1771 - 1858)
‘Father of Modern Personnel Management’
Swiss Industrialist and reformer/ advocate of
working class factory workers.
Pioneer in the field of Human resource
management process.
 Reduce working hours from 13 - 10 hours/day.
 Set a minimum hiring age (10 year)
 Provide meal, housing, and shopping facilities
for employees,
 Improved welfare of workers.
 Charles Babbage
‘Father of Modern Computing’
Built the first practical mechanical
calculator and a prototype of
modern computers.
Applied Mathematical concepts in
production.
 Adam Smith
The first contributor of specialization
and concluded:
It increases efficiency and dexterity.
Saves the time lost in passing from one
work to another.
helps to the invention of great number of
machines, which facilitates and bridge and
enable one person to do the work of many.
 1. Scientific Management
Approach
The scientific study of work
methods in order to improve
worker efficiency.
Classical • To increase productivity
Management (output/input) by making the
Theory work easier to perform, and
• To motivate workers to learn
and apply new methods and
techniques
 1. Scientific Management Approach
Problems observed in the factory The studies conducted by Taylor to
system production were: solve the problems are:
Time and motion study
Lack of clear concept of worker - Uniform method of routine
management responsibility. tasks (one best way)
No effective work standards Objective: standardization
were applied Right person to the job
Objective: to scientifically
No incentive was used to select the best worker for a
improve labor’s performance given job
Intuition, rule of thumb methods Individual Incentive
Objective: to determine the
or past experience used for appropriate wage or salary
managerial decisions
 Scientific Management Approach
Frederic W. Taylor
‘Father of Scientific Management’
Summarized 4 Principles of Scientific Management
1. Specialization of activities and scientific methods
2. Workers should be scientifically selected and properly
trained to perform the work.
3. Management and workers shpould cooperate to ensure
work is done with the scientific principles.
4. Work and responsibility should be distributed
scientifically, management should design, set up and
supervise the work and workers are free to perform the
work
 2. Administrative Principles
Henry Fayol
• Grew out for managing complex
organizations.
• Focuses on formalized structure,
division of labor, delegation and
Classical
authority.
Management •
Had two major purposes:
Theory
1. Develop basic principles that
could guide the design, creation
and maintenance of large
corporations, and
2. Identify the basic functions of
managing organizations.
 Henri Fayol (1841-1925):
French industrialist
A. Identified basic function in an industry/business
Technical - producing products
Commercial - buying raw materials and selling products
Security: protecting employees and property
Financial – search for and optimum use of capital
Accounting - recording and taking stock of costs, profits,
and liabilities, keeping balance sheets, profit and loss
statements, etc
Managerial – planning, organizing, commanding,
coordinating and controlling
 Henri Fayol (1841-1925):
B. Management as a separate field of study

 Believed management is a discipline worth studying

because managerial ability could be applied to the
home, the church, the military, the politics, and
industry.
 Said there is a need for the introduction of formal
managerial training schools.
 Henri Fayol (1841-1925):
C. Identified general management principles
Principle1: Division Of Work: breaking down a task
2. Authority & Responsibility: right to give orders and sense of
obligation
3. Discipline: respect of organizational rules
4. Unity of Command: one person should have one boss.
5. Unity of Direction: people in same activity must have same
objective.
6. Subordination of individual interest: organizational interest comes
before individual interest.
7. Remunieration: fair and equitable compensation for workers.
 Henri Fayol (1841-1925):
8. Centralization/decentralization: concentration of authority

9. Scalar Chain/line of authority: number of levels in the

hierarchy
10. Order: material and social order
11. Equity: combination of kindness and justice
12. Stability of tenure of personnel: job security & career
progress
13. Initiative: encouraging to initiate new ideas
14. Esprit De corps: in union there is strength use ability and
 3. Bureaucratic Approach
Max Weber is the founder of this
approach.
It is about the adherence to rules, order
and authority. Characteristics are:
Classical 1.Division of labor
Management 2.hierarchy of authority
Theory 3.rules on duties and rights of
employees
4.Procedure
5.Impersonal relation between people
6. Selection and promotion based on
competence and excellence
 Pros and Cons of Bureaucracy
Pros Cons
1.Behaviour consistency 1.Too much red tape and
2.Job overlapping eliminated paperwork.
3.Hiring and promotion based on 2.No belongingness and devotion
merit so employees don’t care about
4.Division of labor makes workers organization
specialists 3.Because of the excessive rules
and regulations and high
expectations of adherence
employees are treated like
machines.
4.Resistance to change and lack of
new techniques.
 Addresses the human dimension
of work.
 Motivation, conflict, expectations,
and group dynamics, improved
productivity.
 Employees are viewed as
individuals, resources, and assets
 Elton Mayo's Experiment
Hawthorne studies Conclusions
(Hawthorne plant of Other factors than physical factors
Western Electric and monetary incentives, which
affect productivity: social and
Company in Illinois,
psychological
USA.) Social environment:
•to study the effect of  Ability to talk to each other.
physical factors on work  The right to choose their rest
periods.
output such as;  The right to leave the workstation
• Illumination, without permission.
 The right to have a say
• Rest periods, length
Psychological conditions
of working days, and Feeling of social acceptance,
• The payment recognition, and social
importance for being selected for
schemes up on the experiment
productivity
 Maslow’s theory of human needs
A need is a physiological or psychological
deficiency a person feels compelled to satisfy .

 Deficit principle
A satisfied need is not a
Self-
motivator of behavior. actualization
 Progression principle Esteem
A need becomes a
Belongingness
motivator once the
Safety
preceding lower-level
Physiological
need is satisfied. Based on needs satisfaction
McGregor’s Theory of X & Y

 Managers create self-fulfilling prophesies.

 Theory X managers create situations where
workers become dependent and reluctant.
 Theory Y managers create situations where
workers respond with initiative and high
performance.
.
 McGregor’s Theory of X & Y
 McGregor’s Theory X  McGregor’s Theory Y

assumes that workers: assumes that workers are:

Dislike work Willing to work

Lack ambition Capable of self control

Are irresponsible Willing to accept

Resist change responsibility

Prefer to be led Imaginative and creative

Capable of self-direction
 1. Quantitative approach

 Emphasizes the use of systematic

mathematical techniques to solve
complex management problems.
 Helps management to make
decisions in operations by increasing
number of alternatives.
 Management can easily calculate the
risk and benefit of various actions.
 2. Systems Approach
Organizations and the environment within which they
operate are sets of interrelated parts to be managed as a
whole in order to achieve a common goal.

An organizational system has four major components.

 3. Contingency Approach
Accepts the dynamics and complexities of the
organization structure.
An organization is affected by its environment and
environment is composed by physical resources,
climate, persons, culture, economic and market
conditions and their laws.
Thus, there is no one universally applicable set of rules
by which to manage organization.