Evolution of Management Thought

Study Notes

The practice of management has been around for thousands of years, with early beginnings based on "rule-of-thumb" and "word of mouth" approaches.
The systematic and academic study of management began in the early 20th century, with the recording of management knowledge and the establishment of business schools.

Robert Owen, a Scottish textile factory owner, is considered an early pioneer of management.
Owen improved the working and living conditions of workers, including reducing the working day to 10 hours, prohibiting child labor, and establishing a school for workers' children.

The Classical School of Management aims to define the essence of management through universal fundamental principles.
Key principles include:
- High specialization of labor
- Centralized decision making and profit maximization
- Employees have only economical and physical needs, with social needs or job satisfaction considered unimportant

Scientific Management, developed by Frederick Taylor, analyzes and synthesizes workflows to improve economic efficiency and labor productivity.
Key principles include:
- Developing a "science" for each job to find the "One Best Way" to do it
- Decisions based on precise procedures rather than tradition or rules-of-thumb
- Optimizing tasks and simplifying jobs to enable quick training of workers
- Division of work between managers and workers, with managers applying scientific management principles and workers performing tasks
Taylor's Four Principles of Scientific Management:
1. Develop a "science" for each job
2. Hire workers with the right abilities for the job
3. Train and motivate workers to do their jobs according to the science
4. Divide work nearly equally between managers and workers

Criticisms of Scientific Management include:
- Workers were seen as incapable of understanding their work
- Workers could only be motivated by money
- The approach increased the monotony of work, treating workers like machines

Henry Ford's mass production methods aimed to achieve economies of scale through the production of inexpensive goods.
Key features include:
- Assembly line production
- Vertical integration of production
- High wages for workers and social benefits (e.g., 8-hour work day, 5-day work week, kindergarten for workers' children)

Administrative Theories, developed by Henri Fayol and Max Weber, analyze organizations in their social context.
Key principles include:
- Fayol's Five Duties of Managers: planning, organizing, commanding, coordinating, and controlling
- Fayol's Six Main Groups of Activities: technical, commercial, financial, security, accounting, and managerial
- Weber's Bureaucratic Organization: characterized by clear division of labor, hierarchy of authority, formal rules and procedures, impersonality, and careers based on merit

The Behavioral Approach aims to make managers more sensitive to their employees' needs.
Key principles include:
- Assumptions: people are social and self-actualizing
- Elton Mayo's Hawthorne Studies: showed that human needs are important for increasing productivity
- Douglas McGregor's Theory X and Theory Y: separate managers into two beliefs about employees' motivation and behavior

Weaknesses of the Classical Approach include:
- Reliance on experience in large manufacturing firms
- Untested assumptions about workers' motivations
- Failure to consider informal organizations and informal leaders
Weaknesses of the Behavioral Approach include:
- Overemphasis on employees' social needs
- Limited importance given to economic incentives
- Failure to consider the limitations of the approach

The Systems Approach views organizations as open systems that interact with their environment.
Key features include:
- Interdependent parts
- Consideration of the whole system
- Defined boundaries
- Synergy (2 + 2 = 5)
- Feedback mechanism

The Contingency Approach extends the Systems Approach, recognizing that there is no "one best way" to manage.
Key principles include:
- Management is situational, with managers responding to unique situations
- Managers should match their approach to the requirements of the situation
- The success of management depends on its ability to cope with environmental changes