MGT 200 Management Theory
Required Reading:
Chapter 2 of textbook
Peter Senge Article
Meg Wheatly Interview
 Today’s Topic: History of Management
Theory

Learning Objectives
Know the basic premises of six
management theories
 Understand the context for the evolution
and development of these theories
 Know the basic concepts of several current
trends in management
 Explore three forces that are changing the
context for managerial work today

Management Theories/Concepts
Division of Labor
 Scientific Management
 Administrative Theories
 Behavioral Theory
 Chaos Theory
 Contingency Theory

Division of Labor
Adam Smith: “The Wealth of Nations”
 Premise: Increase productivity by breaking
down jobs into narrow, repetitive tasks

Scientific Management
 Management
practices should be based
on fact and observation
 Focuses on the relationship between
individual workers and their tools or
machines
Scientific Management

Frederick Taylor
–
–
–

Frank and Lillian Gilbreth
–

There is “one best way” to perform a task
Time and motion studies
Money motivates employees to do their best
Followers of Taylor
Henry Gantt
–
Control systems for production scheduling
Assessing Scientific Management
 Many
aspects used today
 Misreads human side of work
 Simple tasks and clear rules don’t
guarantee results
Administrative Theories
 Focus
on managers and their behavior
 Henri Fayol, French industrialist
–
Management is a discipline with
principles that can be taught
 Max
–
Weber
Developed the concept of “bureaucracy”
as the ideal structure for an organization
Fayol’s Administrative Principles
1. Division of labor
2. Authority to give orders
3. Discipline
4. Unity of command
5. Unity of direction
6. Subordination of
individual interest
7. Remuneration: pay for
work done
8. Centralization
9. Scalar chain
10. Order
11. Equity
12. Stability and tenure
of staff
13. Initiative
14. Esprit de corps
Bureaucratic Management
Formal system of rules and procedures
 Impersonality
 Hierarchical structure with detailed
authority
 Clear division of labor
 Rationality
 Career commitment

Assessing Administrative Theories
Managers still use many of Fayol’s principles
 Overemphasizes the rational behavior of
managers
 Advantages & disadvantages of bureaucracy

–
–
Benefits: efficiency, consistency
Costs: rigid, slow, difficult to adapt
Behavioral Theory
Focuses on the human aspects of organizations
 Mary Parker Follet

–
–

Management is a dynamic process
Workers should be involved in decisions
Chester Barnard
–
–
Organizations are social systems
Managers need “buy-in” of employees
Hawthorne Studies
A “scientific theory” study that provided
strong support for the behavioral viewpoint
 The Hawthorne Effect: Productivity is
likely to increase when employees are given
special attention regardless of whether
working conditions change
 The social environment of employees also
greatly influences productivity

Behavioral Theory

Basic Assumptions
–
–
–
–
Employees are motivated by social needs
Social forces exerted by peers is strong
Employees respond to managers who help them
satisfy their needs
Managers need to coordinate the work of
subordinates democratically to improve
efficiency
Behavioral Theory Assessment
Adds greatly to the mechanistic view of
managing people
 But human relation skills alone won’t
guarantee increased productivity or high
quality work
 Managing the human aspects of an
organization is a very complex task

Chaos Theory
Margaret Wheatley, 1992
 Look at an organization as a living organism
 Learn management from natural systems
 Basic Premise: Self-organization

–
the tendency of living systems to organize into
structure without any externally imposed plan
Chaos Theory Principles

Information access
–

Relationships
–

Everyone has easy access to all the information
they need to do their job
Everyone has easy access to anyone they need
to do their job
Self-reference
–
The organizations core identity or purpose
Chaos Theory Assessment
Goes against many traditional beliefs about
role of managers
 Requires educated, involved employees
 Requires change in communication methods
 Clear vision/joint purpose is crucial

Contingency Viewpoint
There is no best way to manage in all
situations
 Use the different management viewpoints as
appropriate to deal with various situations
 Managers must be able to diagnose and
understand a situation thoroughly

Contingency Viewpoint

Basic contingency variables:
–
–
–

External environment
Technology
Individuals
Importance of each variable depends on
type of situation and problems being faced
Assessing the Contingency
Viewpoint
Useful approach - makes sense to change
viewpoint depending on situation
 Most managers use intuitively
 Diagnosis very important to determine best
approach
 Many don’t consider to really be a “theory”
of management

–
just draws on other theories
Management Theories Summary
Division of Labor - Adam Smith
 Scientific Management - Taylor, Gilbreths, Gantt
 Administrative Theories - Fayol, Weber
 Organizational Behavior - Follett, Barnard
 Chaos Theory - Wheatley
 Contingency Theory

What’s Next?
Current Trends and Issues in Management
 Read Chapter 2: pages 40-53
 Read Senge handout on Systems Thinking
