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Evolution of Management thought

History of Management theoriesClassical School

Behavioral school

Integration and Contingency school of ManagementOther Contemporary/ Modern theories of Management

Background

Management is Predominantly a Twentieth century Phenomenon

In the earlier years management could never get attention of researchers

The field of Business in which management concepts were applied were held extremely low &un worthy of study

Indifferent attitude of other social scientists

Post World War I & II - created a situation where people started of solution to problems - where

limited resource should be applied in a better wayProblems/ Issues Growing Competition, Complexity of handling large Business Organizations

Hence the need for Systematic Principles & concepts was felt

Recent Developments worldwide rivalry for markets, power and progress

Increasing Competition -

Technological Innovations & their dissemination in Businesses

Growing Technological ObsolescenceIncrease in Capital investment

Freedom at national & international markets

Increasing buyers

Complexity of Managing Business

Increasing size of Business organizations

High degree of division of labour & specializationIncreased government regulations & control to make businesses more socially-oriented

Organized labour union activities to put pressure on the management

Pressure of various other conflicting interest groups

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Both growing Competition &complexityin Managing Business have demandedefficiency in the Management Process

Classification of Management Thought

Emergence of a variety of Approaches & orientations in management -

1. Classical Approach - Scientific/ Administrative /OperationalManagement2. Neo Classical Approach -Human relations / Social Systems Approach / Decision Theory Approach/Management Science Approach / Human Behavior Approach

3. Modern Approach Systems Approach/ Contingency Approach

Classical Theory of Management

Scientific Management F W TaylorProcess Management Henri Fayol

Bureaucracy Max Weber

Fredrick Taylor Father of Scientific Management

Frederick Winslow Taylor was an American mechanical engineer who sought to improveindustrial efficiency

Taylor was one of the first managementconsultants. He was one of the first to haveimmense imp

act on the early development of ManagementRising from the lowest to a high rank gave him a number of opportunities to understand the

problems and attitudes of workers and see the great possibilities for improving the quality of

Management

Famous Work - The Principles of Scientific Management.

Trainee to common Labour to Foreman to master mechanic to Chief Engineer of a steel

company

Essence of his story

His primary concern was to increase productivitythrough greater efficiency in production andincr

eased pay for workersHe emphasized on using science, creating group harmony and cooperation, achieving the

maximum output and training workers

Key Objectives of the theory

1. Replacing the decisions based upon tradition and old rule-of-thumb with Science andorganized procedures developed after careful study of an individual at work

2. Obtaining harmony in group action and develop a standard method for performing each job

3. Selection is based upon technical competence and experience4. Training and development of workers to the fullest extent possible for their own and the

companys highest prosperity

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5. Labour is defined and authority/responsibility is legitimized

6. Sprit of immense cooperation between workers and management to ensure that tasks are

carried out in accordance with the scientifically devised procedures. Support workers byplanning their work and eliminating interruptions

7. Actions and decisions are recorded to allow continuity and memory.

8. Managers follow rules/procedures to enable reliable/predictable behavior.9. Management is different from ownership of the organization. Positions placed in hierarchy

and under authority of higher level

10. Provide wage incentives to workers for increased output.

Henry Fayol Modern Operational Management Theory

Henri Fayol, a French management theorist is referred to as " the father of modern operational

management theory"

.He was one of the most influential contributors to modern concepts of management.

Fayol's work has stood the test of time and has been shown to be relevant and appropriate tocontemporary management

.

Based largely on his own management experience, he developed his concept of administrationHe derived 14 principles of management that were discussed in detail in his book - General and

Industrial Management, widely considered a foundational work in classical management theory

Henry Fayols 14 Principles of Management

1. Authority & Responsibility - The right to give orders/ issue commands and the power to

extract obedience. There should be a balanced responsibility for this function2. Specialization or Division of labour Specialization allows individuals to build up

experience and the continuous improvement in skills. It gives way to higher productivity and

efficiency3. Discipline - The workers should be obedient and respectful of organization.

The management should provide good leadership. There should be no slacking, bending of rules

4. Unity of command - Employees should receive orders from one superior. There should not beany conflicting lines of command

5. Unity of direction People engaged in the same kind of activities must have the same

objectives in a single Plan. This is essential to ensure unity and coordination in the enterprise

6. Subordination of Individual Interests - When at work, only things related to work should bepursued or thought about

7. Remuneration - Employees receive fair payment for services, not what the company can get

away with8. Centralization - Consolidation of management functions. Decisions are made from the top

9. Chain of Superiors (line of authority) - A hierarchy is necessary for the unity of direction. It

refers to the formal chain of command running from top to bottom of the organization.it should not be over-stretched or consist of too many levels

10. Order Social as well as material order is necessary. Both should stand at their prescribed

places

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11. Equity In a running business a combination of kindliness and justice is needed.

Treating employees well is important to achieve equity

12. Personnel Tenure Employees work better if job security and career progress are assured tothem. An insecure tenure and a high rate of employee turnover will affect the organization

adversely.

13. Initiative Allowing all personal to show their initiative in some way is a source of strengthfor the organization

14. Esprit de corps There should be harmony and cohesion/ consistency/commonality among

personnel

It's a great source of strength in the organization.

Fayol stated that for promoting esprit de corps, the principle of unity of command shouldbe observed along with teamwork, the dangers of divide and rule

Relevance in todays context

Some of these ideas may seem self-evident today, but can be seen as being revolutionary in

Fayol's time

Until today, his principles remain important as they continue to have a significant impact on

current managerial thinking

Fayol's main contribution was the idea that management was not a talent related to genetic

hereditary, but a skill that could be taught.(doesnt flow down from generations but can

be learned)

He created a system of ideas that could be applied to many areas of management and laid

down basic rules for managing large organizations

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