Prof. Josefina B. Bitonio, DPA FDM 201 Principles and Processes of

Development Management

Classical Organization

Theories

Major Contributors to the Classical Organizational Theory:

Scientific Management:

Frederick Taylor

Administrative Management:

Henri Fayol

Luther Halsey Gulick

Max Weber

• dubbed as the “Father of Scientific Management,” is best known for his “one best way approach” in accomplishing task. Classical organization theory evolved from this notion.

Frederick Taylor

Scientific management – focusing on the management of work and workers

Taylor, Generally considered the father of scientific management pioneered the development OF TIME AND MOTION STUDIES. He wrote and published the result of his studies in 1911 on the PRINCIPLES OF SCIENTIFIC MANAGEMENT.

Ingenuity and Accomplishments

• Creates systems to gain maximum efficiency from workers and machines in the factory.

• Focuses on time and motion studies to learn how to complete a task in the least amount of time.

• Becomes consulting engineer for many other companies

Revisiting Time and Motion Studies

The time studies performed by Taylor, which were later classified as time and motion studies, were characterized by timing a worker’s series of motions and determining the optimal way in which to perform their particular job. The goals of the study are as relevant today as they were back then - to increase the efficiency of a business process.

Time and motion studies have been successful in various implementations enabling companies to move forward in providing logical frameworks for improving and leaning their operations.

“One best Way” Taylor's scientific management consisted of four principles: 1. Replace rule-of-thumb work methods with methods

based on a scientific study of the tasks. 2. Scientifically select, train, and develop each employee

rather than passively leaving them to train themselves. 3. Provide "Detailed instruction and supervision of each

worker in the performance of that worker's discrete task" (Montgomery 1997: 250).

4. Divide work nearly equally between managers and workers, so that the managers apply scientific management principles to planning the work and the workers actually perform the tasks.

Henri Fayol

• Engineer and French industrialist

• In France works as a managing director in coal-mining organization

• Recognizes to the management principles rather than personal traits

• While others shared this belief, Fayol was the first to identify management as a continuous process of evaluation.

Fayol’s 5 Management Functions

Fundamental roles performed by all managers:

Planning

Organizing

Commanding

Coordinating

Controlling

Additionally Fayol recognizes fourteen principles that should guide the management of organizations.

Fayol’s 14 Principles:

1. Division of Work —improves efficiency through a reduction of waste, increased output, and simplification of job training

2. Authority and Responsibility—authority: the right to give orders and the power to extract obedience – responsibility: the obligation to carry out assigned duties

3. Discipline—respect for the rules that govern the organization

4. Unity of Command—an employee should receive orders from one superior only

5. Unity of Direction—grouping of similar activities that are directed to a single goal under one manager

6. Subordination of Individual Interests to the General Interest—interests of individuals and groups should not take precedence over the interests of the organization as a whole.

7. Remuneration of Personnel—payment should be fair and satisfactory for employees and the organization

8. Centralization—managers retain final responsibility – subordinates maintain enough responsibility to accomplish their tasks

9. Scalar Chain (Line of Authority)—the chain of command from the ultimate authority to the lowest

10. Order—people and supplies should be in the right place at the right time

11. Equity—managers should treat employees fairly and equally

12. Stability of Tenure of Personnel—managerial practices that encourage long-term commitment from employees create a stable workforce and therefore a successful organization

13. Initiative—employees should be encouraged to develop and carry out improvement plans

14. Esprit de Corps—managers should foster and maintain teamwork, team spirit, and a sense of unity among employees

Luther Halsey Gulick (1892-1992)

• A specialist in municipal finance and administration

• Gulick works with the Institute of Public Administration, professor of municipal science and administration at Columbia, and serves on Franklin D. Roosevelt’s Committee of Government Administration

• Expands Fayol’s five management functions into seven functions:

1. Planning - developing an outline of the things that must be accomplished and the methods for accomplishing them

2. Organizing - establishes the formal structure of authority through which work subdivisions are arranged, defined, and coordinated to implement the plan

3. Staffing - selecting, training, and developing the staff and maintaining favorable working conditions

4. Directing - the continuous task of making decisions, communicating and implementing decisions, and evaluating subordinates properly

5. Coordinating - all activities and efforts needed to bind together the organization in order to achieve a common goal

6. Reporting - verifies progress through records, research, and inspection; ensures that things happen according to plan; takes any corrective action when necessary; and keeps those to whom the chief executive is responsible informed

7. Budgeting - all activities that accompany budgeting, including fiscal planning, accounting, and control

Max Weber (1864-1920)

• German sociologist

• Weber first describes the concept of bureaucracy – an ideal form of organizational structure

• He defines bureaucratic administration as the exercise of control on the basis of knowledge

• Weber states, “Power is principally exemplified within organizations by the process of control”

Weber uses and defines the terms authority and power as:

• Power: any relationship within which one person could impose his will, regardless of any resistance from the other.

• Authority: existed when there was a belief in the legitimacy of that power.

Weber classifies organizations according to the legitimacy of their power and uses three basic classifications:

Charismatic Authority: based on the sacred or outstanding characteristic of the individual.

Traditional Authority: essentially a respect

for customs. Rational Legal Authority: based on a code or

set of rules.

Weber recognizes that rational legal authority is used in the most efficient

form of organization because:

• A legal code can be established which can claim

obedience from members of the organization

• The law is a system of abstract rules which are applied to particular cases; and administration looks after the interests of the organization within the limits of that law.

• The manager or the authority additionally follows the impersonal order

• Membership is key to law obedience

• Obedience is derived not from the person administering the law, but rather to the impersonal order that installed the person’s authority

Weber outlined his ideal bureaucracy as defined by the following parameters:

• A continuous system of authorized jobs maintained

by regulations • Specialization: encompasses a defined “sphere of

competence,” based on its divisions of labor

• A stated chain of command of offices: a consistent organization of supervision based on distinctive levels of authority

• Rules: an all encompassing system of directives which govern behavior: rules may require training to comprehend and manage

• Impersonality: no partiality, either for or against, clients, workers, or administrators

• Free selection of appointed officials: equal opportunity based on education and professional qualification

• Full-time paid officials: only or major employment; paid on the basis of position

• Career officials: promotion based on seniority and merit; designated by supervisors

• Private/Public split: separates business and private life

• The finances and interests of the two should be kept firmly apart: the resources of the organization are quite distinct from those of the members as private individuals.

(a) A tendency to a leveling of social classes by allowing a wide range of recruits with technical competence to be taken by any organization

(b) Elite status because of the time required

to achieve the necessary technical training

(c) Greater degree of social equality due to

the dominance of the spirit of impersonality or objectivity

Simon(1946) in his book, “Administrative Behavior,” created a distinction between theoretical and practical science. He introduced more common principles in the literature of administration administrative efficiency and specialization when he wrote the article, "The Proverbs of Administration.” (Simon 1946 as cited in Shafffritz and Hyde 1997; Stillman 1991)

Proverbs are useful but are not without defects. Simon works to

expose these defects as well as offer some suggestions as to how

the existing dilemma can be solved.

Some Accepted Administrative Principles:

1. Administrative efficiency is increased by a specialization of the

task among the group.

2. Administrative efficiency is increased by arranging the members of

the group in a determinate hierarchy of authority.

3. Administrative efficiency is increased by limiting the span of control

at any point in the hierarchy to a small number.

4.Administrative efficiency is increased by grouping the workers, for

purposes of control, according to (a) purpose, (b) process, (c)

clientele, or (d) place.

Proverbs of Administration

Hebert A. Simon

None of the four principles survive criticism

very well. Administrative description suffers

currently from superficiality, oversimplification,

lack of realism. It is too concerned with

allocation of authority and not with modes of

influence or behavior. Until administrative

description reaches a level of sophistication,

there is little reason to hope that a rapid

progress will be made toward the identification

and verification of valid administrative

principles.

• in 1945, Appleby, led a postwar attack

on the concept of politics-administration dichotomy by drafting a convincing case that “public administration was not something apart from politics” but rather at the “center of political life.” (Stillman 1991: 123)

• In 1948, Dwight Waldo tried to establish the direction and thrust of Public Administration as a field of study in his book, “The Administrative State,” which hit the “gospel of efficiency” that dominated the administrative thinking prior to Word War II. That same year, Sayre attacked public personnel administration as “the triumph over purpose.” (Shafritz and Hyde 1997: 74)

Revisiting Waldo's Administrative State brings together a group

of distinguished authors who critically explore public

administration's big ideas and issues and question whether

contemporary efforts to "reinvent government," promote

privatization, and develop new public management

approaches constitute a coherent political theory capable of

meeting the complex challenges of governing in a

democracy.

Probing the material and ideological background of modern

public administration, problems of political philosophy, and

finally particular challenges inherent in contemporary

administrative reform. It concludes with a look ahead to

"wicked" policy problems -- such as terrorism, global warming,

and ecological threats -- whose scope is so global and

complex that they will defy any existing administrative

structures and values

“gospel of efficiency”

Waldo warned that public administrative efficiency must be backed by a framework of consciously held democratic values. Calling for a return to conscious consideration of democratic accountability, fairness, justice, and transparency in government

“gospel of efficiency”

In 1949, Selznick introduced the so-called

“cooptative mechanism” where he defined “cooptation” as “the process of absorbing new elements into the leadership or policy determining structure of an organization as a means of averting threats to its stability or existence.” (Shafritz and Hyde 1997: 147)

Since administration is concerned will all

patterns of cooperative behavior, it is

obvious that any persons engaged in an

activity is in COOPERATION with the other

persons who is engaged in administration

Everyone has cooperated with others

throughout his life and he has some basic

familiarity with administration and some of

its problems. (Simon, 1991)

A contemporary of Goodnow was William Willoughby (1918). Willoughby stressed the role of the trilogy covering all three branches of government but he was more known for his budgetary reforms. He discussed the movements for budgetary reforms in the US in view of the budget as an instrument for democracy, as an instrument for correlating legislative and executive action, and as an instrument for securing administrative efficiency and economy.

Mary Parker Follet (1926) also made some significant contribution to the discourse of Public Administration as one of the proponents of participatory management and the “law of situation” which can be attributed to the concept of contingency management. She illustrated the advantages of participatory management in her article, “The Giving of Orders. “

In the 1920s and early 1930s, Elton Mayo conducted the Hawthorne experiments on the theory of individuals within an organization which propelled the human relations school of management thought.

Hawthorne Experiments

The Human Relations Movement began with the Hawthorne Experiments. They were conducted at Western Electrical Works in USA, b/w 1924-1932

Part I - Illumination Experiments (1924-27) These experiments were performed to find out the effect of different levels of illumination (lighting) on productivity of labor. The brightness of the light was increased and decreased to find out the effect on the productivity of the test group. Surprisingly, the productivity increased even when the level of illumination was decreased. It was concluded that factors other than light were also important

Part II - Relay Assembly Test Room Study (1927-1929) Under these test two small groups of six female telephone relay assemblers were selected. Each group was kept in separate rooms. From time to time, changes were made in working hours, rest periods, lunch breaks, etc. They were allowed to choose their own rest periods and to give suggestions. Output increased in both the control rooms. It was concluded that social relationship among workers, participation in decision –making etc. had a greater effect on productivity than working conditions.

Part III - Mass Interviewing Programme (1928-1930) 21,000 employees were interviewed over a period of three years to find out reasons for increased productivity. It was concluded that productivity can be increased if workers are allowed to talk freely about matters that are important to them. Part IV - Bank Wiring Observation Room Experiment (1932) A group of 14 male workers in the bank wiring room were placed under observation for six months. A worker's pay depended on the performance of the group as a whole. The researchers thought that the efficient workers would put pressure on the less efficient workers to complete the work. However, it was found that the group established its own standards of output, and social pressure

• The social and psychological factors are responsible for workers' productivity and job satisfaction. Only good physical working conditions are not enough to increase productivity.

• The informal relations among workers influence the workers' behavior and performance more than the formal relations in the organization.

• Employees will perform better if they are allowed to participate in decision-making affecting their interests.

The conclusions derived from the Hawthorne Studies were as follows :-

•Employees will also work more efficiently, when they believe that the management is interested in their welfare.

•When employees are treated with respect and dignity, their performance will improve.

•Financial incentives alone cannot increase the performance. Social and Psychological needs must also be satisfied in order to increase productivity.

Chester Barnard (1938) presented a more comprehensive theory of organizational behavior when he wrote the functions of the executive. He argued that for the executive to become more effective, he should maintain an equilibrium between the needs of the employees and the organization.

His concepts were later explored and

developed into more comprehensive theories and principles as advocated by other researches in organizational behavior and management, such as, Herzberg’s “motivation hygiene theory,” Mc Gregor’s “Theory X and Y,” 11 Argyris’ “personality versus organization and Likert’s Systems 1 to 4, among others. (Shafritz and Hyde 1997)

Maslow (1943), on the other hand, focused on the hierarchical needs of the individual. His “theory of human motivation,” states that the human being has five sets of needs: physiological, safety, love or affiliation, esteem and ultimately, and self-actualization.

Public Administration is often characterized as a fragmented field – one that is pulled in competing directions by different intellectual and disciplinary perspective as well as by the concerns of practice and theory, Nevertheless, it does have a common core of knowledge and coherent intellectual history

www.ginandjar.com

Common Criticisms of Classical Organizational Theory

Classical principles of formal organization may lead to a work environment in which:

• Employees have minimal power over their jobs

and working conditions • Subordination, passivity and dependence are

expected • work to a short term perspective • Employees are lead to mediocrity • Working conditions produce to psychological

failure as a result of the belief that they are lower class employees performing menial tasks

Alex Brillantes, Jr. and Maricel Fernandez Is there a Philippine Public Administration or Better Still, for whom is Public Administration? UP NCPAG. June, 2008

Reference:

Vincent Myers and Nina Presuto. Classical Organizational Theory www.tcnj.edu/~wright/classicalb.pp