Chapter 2
The Evolution of Management
Learning Objectives
 Describe the historical foundation of management
 Explain the beginnings of modern management
theory and education
 Outline the progression of the quantitative approach
to management
 Outline the progression of the humanistic approach
to management
 Interpret the factors that led to a balanced approach
to management
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The Historical Foundations of
Management (p. 32)
 “Wealth of a Nation” – Adam Smith (p. 33)
• Division of labor – workers specialize on a task
 Corporation
• Legal entity formed and structured to achieve goals
with special protections for owners
 Dartmouth College v. Woodward
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Discovering and Teaching
Management Theory (p. 33)
 Bureaucratic management – Max Weber (p. 34)
• Bureaucracy – an organization marked by:
 Division of labor
 Managerial hierarchy
 Formal selection
 Career orientation
 Formal rules and controls
 Impersonality
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Discovering and Teaching
Management Theory (cont.)
 Administrative management – Henri Fayol (p. 35)
• Administrative theory
 Identifies the functions of management
 Successful management linked to satisfied and motivated
employees
 “Art of management”
 Management principles must be adapted to every need
 Provided the basis for management education
 Principles of management
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The Quantitative Approach (p. 37)
 Soldiering
• Workers tested management by performing as slowly as
possible, while creating the impression that they were
working fast
 Natural soldiering
 Systemic soldiering
 Quantitative approach
• Applying objective methods to enhance decision making
 Management science
• Using statistics, mathematics, and other quantitative methods
to improve efficiencies
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The Quantitative Approach (cont.)
 Scientific management – Frederick Taylor (p. 37)
• Classical perspective – make organizations and workers
operate as efficiently as possible
• Used quantitative approach to analyze and synthesize the flow
of work to maximize productivity
• Task-management system – combination of setting
performance standards, selecting the best worker for the job,
and building good relations between managers and employees
(p. 38)
 Harrington Emerson – principles of efficiency
 Blueprint for the art and science of management
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The Quantitative Approach (cont.)
 Motion studies – Frank B. Gilbreth (p. 39)
• Motion picture cameras captured the step-by-step movements
taken to complete a task
• Sought efficiencies by orchestrating the maximum results for
the least worker effort
 Scientific management and the mind – Lillian Gilbreth
(p. 40)
• Studied how managerial perceptions, emotions, and thoughts
affected work and employees
• Three historical types of management
 Traditional
 Transitory
 Scientific
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The Quantitative Approach (cont.)
 Visualizing management – Henry Gantt (p. 40)
• Habits of industry
 Training converted invisible internal forces into visible
behaviors such as industriousness and cooperation
• Developed methods for visualizing performance
standards
 Importance of time
 Gantt progress
chart
Figure 2.1
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The Quantitative Approach (cont.)
 Quality movement (p. 42)
• Ford Motor Company
 Assembly line – parts added sequentially to manufacture a product more
quickly
 Interchangeable parts
• Operations research – established a quantitative rationale for
decisions that lead to goal attainment
• Edwards Deming





Continuous improvement (p. 43)
Quality circles
Lean manufacturing
Total quality management
Six sigma
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The Humanistic Approach (p. 43)
 Focused on the human side of management
 Hawthorne studies (p. 44)
• Employees motivated by more than money
• Group dynamics have an impact on worker morale and
performance
 Illumination study – performance increased when lighting increased or
decreased
 Relay assembly test room – productivity increased following various
changes in work conditions
 Interviewing program – non-directive interviewing (p. 45)
• Managers encouraged to treat workers as people and to
approach groups informally, thereby increasing productivity
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The Humanistic Approach (cont.)
 Conflict: Mary Parker Follett (p. 45)
• Constructive conflict – positive outcomes from group
conflict emerge when individual ideals remain intact
and become part of a “single whole” (p. 46)
Figure 2.2
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The Humanistic Approach (cont.)
 Conflict: Mary Parker Follett (cont.)
• “Power with people,” not “power over people” (p. 47)
 Motivation: Douglas McGregor
• Theory X – negative assumptions about worker motivation
 People do not like work; must be coerced or intimidated
• Theory Y – positive view about worker motivation
 People enjoy the mental and physical purpose of work; try to expand
their personal contributions
• Behavioral management – relies on understanding individual
behaviors, decisions, and attitudes to motivate employees
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The Balanced Approach (p. 48)
 Contingency (situational) theory
• Different organizations, situations, and contexts require different
approaches
 Cooperation: Chester I. Barnard (p. 49)
• Entropy – inefficient organizations lose social and market-based
energy leading to the decline of the system
• Negative entropy – social and market-based energy that builds or
maintains a system
• Managers must maintain an equilibrium of internal and external
forces and their relationship to the organization
 Cooperative system – managers of effective and efficient organizations
control and influence people’s behavior by modifying their motives
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The Balanced Approach (cont.)
 Systems: Jay W. Forrester (p. 49)
• System dynamics – enable managers to achieve
“equilibrium” and stability in their organizations
• von Bertalanffy – general systems theory
 Organizations are open systems
 Have the power to change and be changed by external and internal
forces
 Organizational whole comprised of interdependent
subsystems
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