Classical Management
Foundations for the Future of
Management Education
Ellen S. O’Connor, Ph.D., M.B.A.
(ellensoconnor@gmail.com)
Philosophie & Management (www.philoma.org)
Brussels, June 23, 2014
Chester Barnard
1886 - 1961
Mary P. Follett
1868 - 1933
What must
be done?
3. Build on this
knowledge
1. Recover
forgotten
knowledge
2. Understand
Why it was
forgotten
Industrialization &
the new organizational form
• Unlike familiar forms (church, state & military)
• Relating to (discovery) & applying basic science
(exploitation)
• Converting to scale reliably & continuously (formal
organizing)
• Spreading quickly
More
More
artificial
fictitious
More
ephemeral
New
organizational
form
More
complex
Potentially Very large
Potentially generating
scale
massive wealth
Education gap for the new industry
• “Business” schools:
Clerks
• Colleges: Gentlemen
Wealthy industrialists
look for new institutions
• Scientific schools:
engineers
Accelerating factors
Pennsylvania
state militia fires
1877
Injunctions against unions
1877
Panic of 1873
1879
Credit mobilier
fraud 1870’s
Great railroad
strike 1877
First Collegiate school of business curriculum
Modern industry requires us to organize
under single leaders…
great amounts of capital & numbers of laborers
The fruits of organized labor must be
properly divided
among
capitalist, leader & workman
The importance of educating
men to combine their energies
Joseph Wharton
1826 - 1909
for the accomplishment of any desirable object,
and the principles upon which such
combinations should be effected
Instill
new values
Wharton’s
agendas
Make
new discoveries
Teach
new subjects
Decentralization
Regimentation
New
organizational
form
(deeper)
Suboptimization
Uncertainty
New organizational form’s consequences
New individual, collectivity & interdependencies
 New knowledge
But no institutional support for generating &
growing that knowledge
Missed opportunities: the 4 crises
1890
New York
University
College
1881
Wharton
Collegiate School
of business
1948
Carnegie
Graduate School of
Industrial Admin.
1919
Harvard
Business
School
Comprenhensive
knowledge transfer
(Barnard & Harvard in 1930’s-40’s); Simon’s seminars on Barnard in late 40’s)
The
Classics’
contribution
Basic science of
General
collective value(s) creation
theory of organization
Follett (1924)
Barnard (1938)
Exerting
centripetal force
The
Classics’
Key managerial
roles
Securing
Building an
creative contribution of all
interdependence culture
Agenda: Short-Term Wealth Maximization
• Microeconomics
• Corporate strategy
• Shareholder value
theory
• Neoclassical economics
No pursuit of problems &
solutions identified by
classical management
Next steps?
1. Recover
forgotten
knowledge
• Educate
educators
2. Understand
why it was
forgotten
• Developing
historical
sensibility
3. Build on classical
management theories &
findings
• Research
• Rigorous testing
• Living case method
Classical Management for today
A workshop
Ellen S. O’Connor, Ph.D., M.B.A.
(ellensoconnor@gmail.com)
Philosophie & Management (www.philoma.org)
Brussels, June 24, 2014
Purpose of management education
Develop
members & leaders of formal organization
who master the tool of organization,
in pursuit of
individual & collective
value(s) creation
at the highest level,
continuously, and
in the long run
Need for a higher-order institution with the
knowledge to provide that education
• Develop members and leaders of formal
organization
who master
the tool of
Need
for a consensus
on
organization, in pursuit of individual and
• Vision
collective value(s) creation at the highest
• Terminology
level, continuously,
and in the long run.
• Tested
& proven findings
• This calls for a higher-order institution with
the knowledge to provide that education.
Names
& titles
Historical
figures
Key
findings
What We
Know So Far
Living
insights
Educational
experiments
“Failed” educational experiments: the 4 crises
1890
New York
University
College
1881
Wharton
Collegiate School
of business
1948
Carnegie
Graduate School of
Industrial Admin.
1919
Harvard
Business
School
Wharton
Fayol
Taylor
Follett
(1826-1909)
(1841-1925)
(1856-1915)
(1868-1933)
Rowntree
Donham
Barnard
(1871-1954)
(1877-1954)
(1886-1961)
Key findings
Key Findings
Core knowledge
Science based on
grown piecemeal
individual experience
in a small group
“in the physiological condition
of scientifically & developmentally
of personal responsibility”
minded executives
in formal organization
Business schools: so far organized to
serve academic & technical specialists
Comprenhensive
knowledge transfer
(Barnard & Harvard in 1930’s-40’s); Simon’s seminars on Barnard in late 40’s)
Living
Insights
(key classics’
contributions)
Basic science of
General
collective value(s) creation
theory of organization
Follett (1924)
Barnard (1938)
Discovery
v.
Exploitation
Centrifugal
v.
Centripetal
Management
Individual
v.
Group
Value(s) creation
Freedom
v.
Subordination
pivot
multiplier, in pursuit of
creative tension between
conflicting forces
(sensed within)
Individual
v.
Regimentation
Contributing
v.
Witholding
Discovery
Centrifugal
The Conflicting
and
Creative
Forces
v.
v.
Centripetal
•
•
•
•
•
•
Exploitation
Organization: Centrifugal
v. centripedal
Management
Organization: Discovery v. exploitation
Value(s)
creation
Individual
Organization:
The individual v. the group
Individual
v.
v.
pivot
Individual:
Individualism v. regimentation
Group
Regimentation
multiplier, in pursuit of
creative tension
between
Individual: Freedom
v.
subordination
conflicting forces
(sensed within)
Individual: Contributing
v. withholding
Freedom
v.
Subordination
Contributing
v.
Witholding
(re)invent
(re)invent
purposes
moral codes
Executives exert
integrate
internally
centripetal
force
incarnate through
own person
(Subordination, predictability
& sincerity)
integrate
externally