HISTORICAL BACKGROUND

OF MANAGEMENT
Doc. Valentina Peleckienė
2020
VGTU
 Objectives:
1. Earlier scientists: Sun Tzu and Nicola
Machiavelli.
2. Scientific management:
Frederic Taylor – father of scientific
management.
3. Liliana and Frenc Gilbreath, H.Gant
4. Henry Fajol, Max Weber.
Sun Tzu
 Sun Tzu
• Sūn Wu (544-496 BC), the author of
• The Art of War, an immensely influential
ancient Chinese book on military strategy.
• The Art of War has been the subject of legal
books and legal articles on the trial process,
including negotiation
• tactics and trial strategy.
 Sun Tzu’s approach to warfare
• unlike that of Western authors,
• does not put force at the center:
• indeed, the Chinese character li (force)
• occurs only 9 times
• in the text’s 13 chapters.
This reflects the conditions of warfare
• in China at the time
• (force was then in fact of limited utility)
• as well as Sun Tzu’s conviction
• that victory and defeat
• are fundamentally
• psychological states.
 He sees war,
• not so much as a matter of destroying the
enemy materially and physically
• (although that may play a role),
• but of unsettling the enemy
• psychologically;
 His goal is:
to force the enemy’s leadership and society
from a condition of harmony,
in which they can resist effectively,
toward one of chaos (luan),
which is tantamount
to defeat.
 Sun TZU
• “If you know the enemy and know yourself, you need
not fear the result of a hundred battles.

• If you know yourself but not the enemy, for every

victory gained you will also suffer a defeat.

• If you know neither the enemy nor yourself, you will

succumb in every battle.”
 Niccolò Machiavelli Diplomat, Writer
(1469–1527)
Italian diplomat Niccolò Machiavelli is best
known for writing The Prince,
a handbook for unscrupulous politicians that
inspired the term "Machiavellian„
and established its author as the
"father of modern political theory."
 There are many examples
Which demonstrate that organizations and
managers have been around for thousands of
years: Egyptian pyramids;
The Great Wall of China;
The city of Venice.
 However, two historical events
• Are especially significant to study of
management:
1) Adam Smith – the Wealth of Nations, 1776;
2) Industrial revolution in late XVIII century.
 Adam Smith (1723–1790)

• Scottish social Philosopher, Political Scientist,

Journalist, Educator, Scholar, Economist.
• He wrote The Wealth of Nations
• and achieved the first
• comprehensive system
• of political economy.
 The first
• In 1776 year Adam Smith published
• the Wealth of Nations,
• in which he argued the economic advantages
• that organizations and society would gain
• from the division of labor
• (or job specialization).
 Example: pin industry
• 10 individuals each doing a specialized task,
could produce about 48 000 pins a day
among them.
• However , if each person worked alone,
performing each task separately,
• it would be only about 10 pins a day.
 Adam Smith concluded
• that division of labor increased productivity
• by increasing each worker‘s skill and
dexterity,
• by saving time, lost in changing tasks
• and by creating labor–saving inventions and
machinery.
 Now we can find for example:

• Specific tasks performed by members of a

hospital surgery team,
• Specific meal preparation tasks done by
workers in restaurant kitchens,
• Or specific positions played by players on a
football team.
 The second important event:
• Started in the late 18 century is
• the industrial revolution.
• During this time, machine power was
substituted for human power,
• making it more manufacture
• goods in factories
• rather than at home.
 These large factories
• Needed managers:
 to forecast demand,
 ensure that enough material was on hand to
make products,
 assign tasks to people,
 direct daily activities and so on.
 The need for formal theories
• To guide managers in running these large
organizations had arrived.
• However, it wasn‘t until the early 1900s.
 Developement of Major Management
Theories
• There are six major approaches to
management:
1. Scientific management;
2. General administrative;
3. Quantitative;
4. Organizational behavior;
5. Systems;
6. Contingency.
 Management theories
• .Historical General
Scientific Quantitative Oragnizationa
Background Administrative
Management Approach Behavior
Theorists

Early examples Early

Systems Contingency Advocates
of Management
Approach Approach

Hawthorne
Adam Smith
Studies

Industrial
revolution
 The classical approach
• The classical approach to management was
the product of the first efforts
• to develop a body of management thought;
• can be broaken down
• into two distinct areas.
 I. Lower-level management analysis,

consists primarily of the work of:

1. Frederic W. Taylor,
2. Frank and Lillian Gilbreth,
3. Henry L.Gantt.
They studied the jobs of workers
at lower levels of organization
Lower-level management analysis
• Lower-level management analysis
concentrates on the “one best way”
• to perform a task;
• This process has become known
• as the scientific method of management,
• or simply, scientific management.
Frederck W. Taylor (1856-1916)
1911- the year of modern management
theory was born
 In 1911 year
• F.W. Taylor published his book
• Principles of Scientific Management.
• The book described the theory of scientific
management:
• the use of scientific methods to define the
„one best way“ for a job to be done.
• https://books.google.lt/books?id=OOxW-cgNt
5sC&printsec=frontcover&hl=lt#v=onepage&q
&f=false
 1) Frederick W. Taylor
• Worked at the Midvale and Bethlehem Steel
Companies in Pensylvania
• as a mechanical engineer.
• He spent more than two decades
• pursuing the „One best way“ .
 The best known example:
pig iron experiment
• Workers loaded „pigs“ of iron (each weighing
92 pounds) into railcars.
• Their daily average output was 12,5 tons.
• After applying scientifically different
combinations of procedures,
• techiques and tools,
• Taylor succeeded in getting
• 47 or 48 tons per day.
Using similar approaches for other jobs
• Taylor was able to define the „one best way“
for doing each job.
• Productivity grew for 200 percent or more.
• His ideas spread in the United States, France,
Germany, Russia and Japan.
• His most prominent followers were:
• Frank and Lillian Gilbreth
2) Frank and Lillian Gilbreth
 Frank Gilbreth and his wife
• Studied work to eliminate inefficient
• hand-and-body motions.
• The best known experiment is in bricklaying.
• He reduced the number of motions in laying
exterior brick from 18 to about 5
• on laying interior brick – from 18 to 2.
• Using their technique bricklayers were more
productive and less fatigued
• at the end of the day.
 Gilbreths
• Invented a device called a microchronometer
that recorded a worker‘s motions
• And the amount of time
• spent doing each motion.
 3) Henry L. Gantt (1861-1919)
• The third major contributer
• to the scientific management approach
• was Henry L.Gantt.
• Gantt attributed unsatisfactory or ineffective
tasks and piece rates
• (incentive pay for each
• product piece
• an individual produces).
•
 Gantt’s management philosophy
• is encapsulated in this statement that
• “the essential differences between the best
system of today and those of the past
• are the manner in which tasks are
“sheduled”
• and the manner in which their performance is
rewarded”.
 Using this rationale H.Gant
• sought to improve systems or organizations
through:
1. task-scheduling innovation
2. and the rewarding of innovation.
 1) Scheduling innovation
The Gantt chart,
the primary scheduling device
that Gantt developed,
is still the scheduling tool
most commonly used
by modern managers.
 2) Rewarding Innovation
• Gantt was more aware
• of the human side of production
• than either Taylor or the Gilbreth.
 In contrast to Taylor,
• who pioneered a piece-rate system
• under which workers were paid
• according to the amount they produced
• and who advocated
• the use of
• wage-incentive plans,
•
 Gantt developed a system
• wherein workers could earn a bonus
• in addition to the piece rate
• if they exceeded
• their daily production quota.
 II. Second area is
comprehensive analysis of management,
concerns the management function
as a whole.
The primary contributers to this category were:
1) Henry Fayol,
2) Max Weber.
Henry Fayol ( 1841-1925)
 Henri Fayol ( 1841-1925)
• was a French mining engineer, mining
executive, author and director of mines
• who developed a general theory
• of business administration.
• Like his contemporary, Frederick Taylor,
• he is widely acknowledged
• as a founder of
• modern management methods.
 Henry Fayol's work
• He proposed that there were:
1. five primary functions of management
2. fourteen principles of management.
 H.Fayol outlined main management
functions:
1. planning,
2. organizing,
3. commanding,
4. coordinating,
5. controling.
General principles of management
1. Division of work;
2. Authority;
3. Discipline;
4. Unity of command;
5. Unity of direction;
6. Subordination of individual interests to the general interests;
7. Remuneration;
8. Centralization;
9. Scalar chain;
10. Order;
11. Equity;
12. Stability of tenure of personnel
13. Initiative;
14. Esprit de corps. (harmony and good feelings among employee
Max Weber (1864 –1920)
Karl Emil Maximilian "Max" Weber
• (1864 –1920) was a Prussian and German
sociologist, philosopher, jurist, and political
economist.
• Weber is often cited, with Karl Marx, as
among the three founders of sociology.
 Max Weber
• was a 19th-century one of the founders of
modern sociology.
• He wrote The Protestant Ethic and the Spirit
of Capitalism in 1905.
 Weber's interest in the nature of power
and authority
• Bureaucratic coordination of activities,
• he argued, is the distinctive mark
• of the modern era.
• Bureaucracies are organized according to
rational principles.
 Offices are ranked
• in a hierarchical order and their operations
are characterized by impersonal rules.
• Incumbents are governed by methodical
allocation of areas of jurisdiction
• and delimited spheres of duty.
 Appointments are made
• according to specialized qualifications rather
than ascriptive criteria.
• This bureaucratic coordination of the actions
of large numbers of people
• has become the dominant structural feature
of modern forms of organization.
 Bureaucratic organization
• is to Weber the privileged instrumentality that
has shaped:
1. the modern polity,
2. the modern economy,
3. the modern technology.
Bureaucratic types of organization
• are technically superior to all other forms of
administration,
• much as machine production is superior to
handicraft methods.
 Yet Weber also noted the dysfunctions of
bureaucracy
• Its major advantage:
• the calculability of results, also makes it
unwieldy and even stultifying
• in dealing with individual cases.
 Thus modern rationalized and
bureaucratized systems
• of law have become incapable of dealing with
individual particularities,
• to which earlier types of justice
• were well suited.
 Max Weber Yuo Tube
• https://www.youtube.com/watch?
v=ICppFQ6Tabw
 Limitation of the classical approach

• Contributors to the classical approach felt

encouraged to write about their managerial
experience largely because of the success
they enjoyed.
• The classical approach, however, does not
adequately emphasize human variables.
 People today

• do not seem to be as influenced by bonuses

as they were in the 19th century.
• It is generally agreed that critical
interpersonal areas,
• such as conflict, communication, leadership,
and motivation,
• were shortchanged in the classical
approach.
 Questions
1. What is the classic approach to management?
2. Define scientific management.
3. What is the significance of Taylor’s work at
Bethlehem Steel Company?
4. What is motion study?
5. What are Gantt’s most significant contributions?
6. What are the comprehensive analysis of
management?
7. Describe Fayol’s general principles of
management.
8. Does the classical approach have limitations?
 .
• Thank you for attention