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©2013 John Wiley & Sons, Inc. All rights reserved. 2-1

1-1©2013 John Wiley & Sons, Inc. All rights reserved.

JOHN R. SCHERMERHORN, JR.

MANAGEMENT12th Edition

C h a p t e r 2

History ofManagement

Thought

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Planning Ahead — Chapter 2 Study Questions

1. What can be learned from classical managementthinking?

2. What insights come from behavioral managementapproaches?

3. What are the foundations of modern managementthinking ?

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Chapter 2 Learning Dashboard

1. Classical Management Approaches1. Scientific management2. Administrative principles3. Bureaucratic organization

2. Behavioral Management Approaches1. Follett’s organizations as communities2. The Hawthorne studies3. Maslow’s theory of human needs4. McGregor’s Theory X and Theory Y

5. Argyris’s theory of adult personality

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Chapter 2 Learning Dashboard

3. Modern Management Foundations1. Quantitative analysis and tools2. Organization as systems3. Contingency thinking4. Quality management

5. Knowledge management and organizational learning6. Evidence-based management

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Figure 2.1 Major branches in the classical approach

to management

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Takeaway 1: Classical Management Approaches

• Four guiding principles of scientific management(Frederick Taylor)1. Develop for every job a “science” that includes rules of

motion, standardized work implements, and properworking conditions.

2. Carefully select workers with the right abilities for the job.

3. Carefully train workers to do the job and give them the

proper incentives to cooperate with the job “science.”4. Support workers by carefully planning their work and

by smoothing the way as they go about their jobs.

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• Scientific management (the Gilbreths) – Motion study

• Science of reducing a job or task to its basic physicalmotions

– Eliminating wasted motions improvesperformance

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• Practical lessons from scientific management – Make results-based compensation a performance

incentive – Carefully design jobs with efficient work methods – Carefully select workers with the abilities to do

these jobs – Train workers to perform jobs to the best of their

abilities – Train supervisors to support workers so they can

perform jobs to the best of their abilities

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•

Administrative principles (Henri Fayol) —rules/duties of management:

Foresight

to complete aplan of actionfor the future

Organization

to provide andmobilize

resources toimplement the

plan

Command

to lead, select,and evaluate

workers to getthe best worktoward the

plan

Coordination

to fit diverseefforts

together and

ensureinformation isshared andproblems

solved

Control

to make surethings happenaccording toplan and to

take necessarycorrective

action

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•

Administrative principles (Henri Fayol) – Scalar chain• there should be a clear and unbroken line of

communication from the top to the bottom of theorganization

– Unity of command• each person should receive orders from only one boss

– Unity of direction• one person should be in charge of all activities with the

same performance objective

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• Bureaucratic organization (Max Weber) – Bureaucracy

• An ideal, intentionally rational, and very efficient formof organization

•

Based on principles of logic,order, and legitimateauthority

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•

Characteristics of bureaucratic organizations: – Clear division of labor – Clear hierarchy of authority – Formal rules and procedures – Impersonality – Careers based on merit

12

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•

Possible disadvantages of bureaucracy: – Excessive paperwork or “red tape” – Slowness in handling problems – Rigidity in the face of shifting needs – Resistance to change – Employee apathy

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Figure 2.2 Foundations in the behavioral or

human resource approaches to management

Human resource

approaches Assumption :People are social

and self-actualizing

Theory ofhuman needsAbrahamMaslow

Hawthornestudies

Elton Mayo

Organizationsas communities

Mary ParkerFollett Theory X and

Theory Y Douglas

McGregor

Personality andorganizationChris Argyris

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Takeaway 2: Behavioral Management Approaches

• Organizations as communities – Mary Parker Follett

– Groups and human cooperation:• Groups allow individuals to combine their talents for a greater

good• Organizations are cooperating “communities” of managers and

workers• Manager’s job is to help people cooperate and achieve an

integration of interests

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• Organizations as communities – Forward-looking management insights:

• precursor of employee ownership,

profit sharing, and gain-sharing

Making everyemployee an ownercreates a sense of

collective responsibility

• precursor of systems thinkingBusiness problemsinvolve a variety ofinter-related factors

• precursor of managerial ethicsand social responsibility

Private profits relativeto public good

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•

Hawthorne studies – Initial study examined how economic incentives

and physical conditions affected worker output – No consistent relationship found – “Psychological factors” influenced results

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•

Hawthorne studies (cont.) – Social setting and human relations• Manipulated physical work conditions to assess impact

on output• Designed to minimize the “psychological factors” of

previous experiment• Mayo and colleagues concluded:

– New “social setting” led workers to do good job –

Good “human relations” = higher productivity

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•

Hawthorne studies (cont.) – Employee attitudes and group processes• Some things satisfied some workers but not others• People restricted output to adhere to group norms

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•

Lessons from the Hawthorne Studies: – Social and human concerns are keys toproductivity

– Hawthorne effect — people who are singled outfor special attention perform as expected

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• Maslow’s theory of human needs – A need is a physiological or psychological

deficiency a person feels compelled to satisfy – Need levels:

• Physiological• Safety• Social•

Esteem• Self-actualization

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Figure 2.3 Maslow’s hierarchy of human needs

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• Maslow’s theory of human needs – Deficit principle

• A satisfied need is not a motivator of behavior – Progression principle

• A need becomes a motivator once the precedinglower-level need is satisfied

– Both principles cease to operate at self-actualization level

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•

McGregor’s Theory X assumes that workers: – Dislike work – Lack ambition –

Are irresponsible – Resist change – Prefer to be led

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•

McGregor’s Theory Y assumes that workersare:

– Willing to work –

Capable of self control – Willing to accept responsibility – Imaginative and creative – Capable of self-direction

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• Implications of Theory X and Theory Y: – Managers create self-fulfilling prophecies – Theory X managers create situations where

workers become dependent and reluctant – Theory Y managers create situations where

workers respond with initiative and highperformance

•

Central to notions of empowerment and self-management

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• Argyris’s theory of adult personality – Classical management principles and practices

inhibit worker maturation and are inconsistentwith the mature adult personality

– Psychological success occurs when people defineown goals

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• Argyris’s theory of adult personality – Management practices should accommodate the

mature personality by:• Increasing task responsibility• Increasing task variety• Using participative decision making

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Takeaway 3: Modern Management Foundations

• Foundations for continuing developments inmanagement

Quantitative analysis and tools

Systems view of organizations

Contingency thinking

Commitment to quality and performance

Knowledge management and learning organizations

Evidence-based management

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• Management science or operations research

The scientificapplications ofmathematicaltechniques tomanagement

problems

Value chainanalysis

Supply chainmanagement

Inventorymanagement

Qualitycontrol

Queuingtheory

Linearprogramming

Networkmodels

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• Quantitative Analysis and Tools• Analytics – the use of large data bases and

mathematics to solve problems and make informeddecisions using systematic analysis

• Typical quantitative approach to managerial problem-solving

– Problem encountered, it is systematically analyzed,appropriate mathematical models and computations applied,optimal solution identified

k d d

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• Organizations as Systems – System

• Collection of interrelated parts that function togetherto achieve a common purpose

– Subsystem• A smaller component of a larger system

– Open systems• Organizations that interact with their environments in

the continual process of transforming resource inputsinto outputs

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Figure 2.4 Organizations as complex networks of

interacting subsystems

T k 3 M d M F d i

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• Contingency thinking – Tries to match managerial responses with

problems and opportunitiesunique to different situations

– No “one best way” to manage – Appropriate way to manage

depends on the situation

T k 3 M d M F d i

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• Quality management – Managers and workers in progressive

organizations are quality conscious• Quality and competitive advantage are linked

– Total quality management (TQM)• Comprehensive approach to continuous quality

improvement for a total organization• Creates context for the value chain

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T k 3 M d M t F d ti

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– Continuous improvement• Continual search for new ways to improve quality• Something always can and should be improved

– ISO certification• Global quality benchmark• Refine and upgrade quality to meet ISO standards

l Slid i l

T k 3 M d M t F d ti

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• Knowledge Management and OrganizationalLearning

– Knowledge management is the process of usingintellectual capital for competitive advantage

– Portfolio of intellectual assets include patents,intellectual property rights, trade secrets, andaccumulated knowledge of the entire workforce

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T k 3 M d M g t F d ti

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• Learning organizations – Organizations that are able to continually learn

and adapt to new circumstances – Core ingredients include:

Encouragelearning

Informationsharing Teamwork Empowerment Participation

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•

Evidence-Based Management – Making management decisions on “hard facts”

about what really works

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Place Slide Title Text HereTakeaway 3: Modern Management Foundations

• Evidence-Based Positive Human ResourceManagement Practices

– Employment security – Selective hiring – Self-managing teams – High pay based on merit – Training and development – Reduced status distinctions – Shared information

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