The Evolution of Management
Thinking
CHAPTER 2
Learning Objectives
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2
Understand how historical forces influence the
practice of management.
Identify and explain major developments in the
history of management thought.
Describe the major components of the classical
and humanistic management perspectives.
Discuss the management science perspective
and its current use in organizations.
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Learning Objectives (contd.)
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Explain the major components of systems
theory, the contingency view, and total quality
management.
Describe the learning organization and the
changes in structure, empowerment, and
information sharing that managers make to
support it.
Discuss the technology-driven workplace and
the role of outsourcing, supply chain
management, enterprise resource planning,
knowledge management systems, and
customer relationship management.
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Management and Organization
4
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Management philosophies and
organization forms change over time to
meet new needs
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Some ideas and practices from the past
are still relevant and applicable to
management today
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Historical Perspective
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Provides a context or environment
Develops an understanding of
societal impact
Achieves strategic thinking
Improves conceptual skills
Social, political, and economic forces
have influenced organizations and the
practice of management
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Forces Influencing
Organizations and Management
Social Forces - values, needs, and
standards of behavior
Political Forces - influence of political
and legal institutions on people &
organizations
Economic Forces - forces that affect
the availability, production, &
distribution of a society’s resources
among competing users
6
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Management Perspectives Over Time
Exhibit 2.1
7
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Classical Perspective: 3000 B.C.
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Rational, scientific approach to
management – make
organizations efficient operating
machines
Scientific Management
Bureaucratic Organizations
Administrative Principles
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Scientific Management: Taylor 1856-1915
General Approach
 Developed standard method for
performing each job.
 Selected workers with appropriate
abilities for each job.
 Trained workers in standard method.
 Supported workers by planning work
and eliminating interruptions.
 Provided wage incentives to workers
for increased output.
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Scientific Management
Contributions
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Demonstrated the importance of compensation for performance.
Initiated the careful study of tasks and jobs.
Demonstrated the importance of personnel and their training.
Criticisms
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10
Did not appreciate social context of work and higher needs of
workers.
Did not acknowledge variance among individuals.
Tended to regard workers as uninformed and ignored their ideas
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Bureaucratic Organizations
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Max Weber 1864-1920
Prior to Bureaucracy Organizations
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European employees were loyal to a single
individual rather than to the organization or its
mission
Resources used to realize individual desires
rather than organizational goals
Systematic approach –looked at organization
as a whole
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Characteristics of Weberian Bureaucracy
Division of labor
with Clear definitions of
authority and responsibility
Personnel are selected
and promoted based
on technical
qualifications
Positions organized
in a hierarchy of authority
Managers subject to
Rules and procedures
that will ensure reliable
predictable behavior
Administrative acts
and decisions recorded
in writing
Management separate
from the ownership
of the organization
Exhibit 2.3
12
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Administrative Principles
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Contributors: Henri Fayol, Mary
Parker Follett, and Chester I. Barnard
Focus:
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Organization rather than the individual
Delineated the management functions of
planning, organizing, commanding,
coordinating, and controlling
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Henri Fayol 1841-1925
Examples of General Principles of Management
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Division of work
Unity of command
Unity of direction
Scalar chain
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Mary Parker Follett 1868-1933
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Importance of common super-ordinate goals for reducing
conflict in organizations
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Popular with businesspeople of her day
Overlooked by management scholars
Contrast to scientific management
Reemerging as applicable in dealing with
rapid change in global environment
Leadership – importance of people vs. engineering
techniques
Ethics - Power - Empowerment
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Chester Barnard 1886-1961
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Informal Organization
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Acceptance Theory of Authority
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Cliques
Naturally occurring social groupings
Free will
Can choose to follow management orders
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Humanistic Perspective
Emphasized understanding human
behavior, needs, and attitudes in the
workplace
Human Relations Movement
Human Resources Perspective
Behavioral Sciences Approach
17
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Human Relations Movement
Emphasized satisfaction of
employees’ basic needs as the key to
increased worker productivity
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Hawthorne Studies
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Started in 1895
Four experimental & three control groups
Five different tests
Test pointed to factors other than illumination
for productivity
1st Relay Assembly Test Room experiment,
was controversial, test lasted 6 years
Interpretation, money not cause of increased
output
Factor that increased output, Human
Relations
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Human Resource Perspective
Suggests jobs should be designed to
meet higher-level needs by allowing
workers to use their full potential
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Abraham Maslow 1908-1970
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Identified a hierarchy of needs
Problems stem from an inability to satisfy
one’s needs
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Douglas McGregor Theory X & Y
1906-1964
Theory X Assumptions
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Dislike work –will
avoid it
Must be coerced,
controlled, directed,
or threatened with
punishment
Prefer direction, avoid
responsibility, little
ambition, want
security
Theory Y Assumptions
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Do not dislike work
Self direction and self
control
Seek responsibility
Imagination, creativity
widely distributed
Intellectual potential
only partially utilized
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Behavioral Sciences Approach
Sub-field of the Humanistic Management Perspective
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Applies social science in an
organizational context
Draws from economics, psychology,
sociology, anthropology, and other
disciplines
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Understand employee behavior and
interaction in an organizational setting
OD – Organization Development
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Management Science Perspective
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Emerged after WW II
Applied mathematics, statistics, and
other quantitative techniques to
managerial problems
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Operations Research – mathematical
modeling
Operations Management – specializes in
physical production of goods or services
Information Technology – reflected in
management information systems
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Recent Historical Trends
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Systems Theory
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Contingency View
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Total Quality Management (TQM)
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Systems View of Organizations
Exhibit 2.5
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Contingency View of Management
Exhibit 2.6
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TQM
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Focuses on managing the total organization to
deliver quality to customers.
Four significant elements are
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Employee involvement
Focus on the customer
Benchmarking
Continuous improvement
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Elements of a Learning Organization
Team-Based Structure
Learning
Organization
Empowered
Employees
Open
Information
Exhibit 2.7
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Types of E-Commerce
Business-to-Consumer B2C
Selling Products and
Services Online
Business-to-Business B2B
Transactions Between
Organizations
Consumer-to-Consumer C2C
Electronic Markets
Created by Web-Based
Intermediaries
Exhibit 2.8
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