Chapter 2
The Evolution of Management
Thinking – Management Theories
Management and Organization
Studying management history helps your
conceptual skills
• Social Forces – aspects of a culture that guide
and influence relationships among people
• Political Forces – influence of political and legal
institutions
• Economic Forces – the availability, production,
and distribution of resources
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Management Perspectives over Time
Classical Perspective
• Emerged during the 19th & early 20th Centuries:
– Rise of the factory system (= large organization)
– Issues regarding structure, training, and employee
satisfaction
• Large, complex organizations required new
approaches to coordination and control
• Three subfields:
1. Scientific management,
2. Bureaucratic organizations, and
3. Administrative principles
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Classical Perspectives –
(1) Scientific Management
• Improve efficiency and labor productivity
through scientific methods
• Frederick Winslow Taylor proposed that workers
“could be retooled like machines”
• Management decisions would be based on precise
procedures based on study
• Henry Gantt developed the Gantt Chart to
measure and plan work
• Gilbreth pioneered time and motion studies to
promote efficiency
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Characteristics of
Scientific Management
Characteristics of
Scientific Management
(continued)
Classical Perspectives –
(2) Bureaucratic Organizations
• Max Weber, a German theorist, introduced the concepts
• You should manage an organization on an impersonal, rational
basis through defined authority and responsibility, formal
recordkeeping, and separation of management and ownership
• Bureaucracy
• Organization depends on rules and records
• Managers use power instead of personality to delegate
• Although important productivity gains come from this
foundation, bureaucracy has taken on a negative tone
• DQ: Suppose you are a creative worker, and do not have much respect
on authority. Is a government job a right choice for your career?
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Characteristics of Weberian Bureaucracy
Classical Perspectives –
(3) Administrative Principles
• Focused on the entire organization
• Henri Fayol, a French mining engineer, was a major
contributor – “General & Industrial Management”
• Identified 5 functions of MGMT: planning, organizing,
commanding, coordinating, and controlling
• 14 general principles of MGMT; many still used today:
– Unity of command: Each employee should have only one boss
– Division of work: Specialized employees produce more with the same
effort.
– Unity of direction: Similar activities should be grouped under one manager.
– Scalar chain: A chain of authority extends from the top to the bottom of an
organization, and should include every employee.
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Humanistic Perspective:
(1) Early Advocates
• Understand human behaviors, needs, and
attitudes in the workplace
• Mary Parker Follett:
– Importance of people rather than engineering
techniques: contrast to scientific management
– Empowerment: facilitating instead of controlling
• Chester Barnard:
– Recognition of the informal organization
– Introduced acceptance theory of authority
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Humanistic Perspective (continued):
(2) Human Relations Movement
• Effective work comes from within the employee
• Hawthorne studies were key contributor
• Human relations paid key variable in increasing
performance
• Employees performed better when managers
treated them positively
• Strongly shaped management practice and
research
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Humanistic Perspective (continued):
(3) Human Resources Perspective
• From worker participation and considerate
leadership to managing work performance
• Combine motivation with job design
• Maslow and McGregor extended and challenged
current theories
– Maslow’s Hierarchy (Chapter 16)
– Theory X and Theory Y
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Theory X and Theory Y
Theory X and Theory Y (continued)
Humanistic Perspective (continued):
(4) Behavioral Sciences Approach
• Scientific methods + sociology, psychology,
anthropology, economics… to develop theories
about human behavior and interaction in an org.
• Organizational Development (O.D.) – field that
uses behavioral sciences to improve organization
• Other strategies based on behavioral science:
– Matrix Organizations
– Self-Managed Teams
– Corporate Culture
– Management by Wandering Around
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Quantitative Perspective
• Also referred to as Management Science (a.k.a. Operations
Research, MS/OR, Decision Science, Operations Mgmt, Supply Chain
Mgmt, Business Analytics, Business Intelligence)
• Use of mathematics & statistics to aid management decision
making; Enhanced by development and growth of the computer
• Operations & Biz Analytics focuses on a scientific analysis of
the physical production of goods and services  BUSN 211, MGMT
371, MGMT 471
• Info. Tech./Info. Systems focuses on technology and software to
aid managers  DATA 235, MGMT 280
• Quants – financial professionals who base their decisions on
complex quantitative analysis  Financial Engineering
Recent Trends:
(1) Systems Thinking
• System: Set of interrelated parts that function as a whole to achieve
a common purpose (goal): Input  Process  Output
• The ability to see the distinct elements of a situation as well
as the complexities; The relationship among the parts form the
whole system
• Subsystems are parts of the system that are all
interconnected
• Synergy – the whole is greater than the sum of its parts:
1 + 1 = 3 instead of 2; Managers must understand subsystem
interdependence and synergy
• Self-Adaptation: Basic System + [Feedback + Control]
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Systems Thinking and Circles of Causality
Recent Trends:
(2) Contingency View
• Every situation is unique, there is no universal
management theory
• Managers must determine what method will work
• Managers must identify key contingencies for the
current situation
• Organizational structure should depend upon
industry and other variables
Copyright ©2012 by South-Western, a division of Cengage Learning. All rights reserved.
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Contingency View of Management
Recent Trends:
(3) Total Quality Management (TQM)
• Quality movement is strongly associated with
Japan
• The U.S. ignored the ideas of W. Edwards
Deming, “Father of the Quality Movement”
• TQM became popular in the 1980s and 90s
• Integrate high-quality values in every activity
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Elements of TQM
 Employee involvement (Toshiba)
 Focus on the customer
 Benchmarking
 Process Improvement
 Each process improvement 
Improvement of the whole organization
 Continuous improvement
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Innovative Management:
Thinking for a Changing World
• Management ideas trace their roots to historical
perspectives
• New ideas continue to emerge to meet the
changing needs and difficult times
• The shelf life of trends is getting shorter and new
ideas peak in fewer than three years
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Managing the Technology-Driven
Workplace
• Social Media programs – Company online community
pages, social media sites, microblogging platforms and
online forums
• Customer Relationship Management (CRM
Systems) – technology used to build relationship with
customers
• Outsourcing – Contracting functions or activities to
other organizations to cut costs
• Supply Chain Management (SCM Systems) –
Managing supplier and purchaser relationships to get
goods to consumers
Supply Chain for a Retail Organization
Sample Review Questions:
• Describe the major components of the classical perspectives.
•Describe the major components of the humanistic management
perspectives.
• Discuss the quantitative perspective and its current use in organizations.
• Explain the major concepts of systems thinking.
•Explain the major concepts of the contingency view.
•Explain the major concepts of the total quality management.
• Name contemporary management tools and some reasons management
trends change over time.
•Describe the management changes brought about by a technologydriven workplace, including the role of customer relationship
management, outsourcing, and supply chain management.
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