Management Principles by Fayol

Management I: Lectures 2 & 3 - Evolution of Management

• The course focuses on how the organizational and managerial focus evolved over time to reach effective and efficient operations.
• It also aims to explain the findings behind modern managerial practices.
• The basic questions of management revolve around increasing organizational performance, effectiveness, and efficiency, and motivating organizational members to improve their performance.
• Key fields of management include planning, organizing, controlling, managing people (motivation, leadership, group behavior, communication), managing work and organization, managing production and operation, managing PO, decision support system, quality management, toolkit in POM.

Evolution of Management Thought

• The evolution of management includes: Origins of Management Thought, The Classical Management Perspective, The Behavioral Management Perspective, The Quantitative Management Perspective, Integrating the major perspectives, and Contemporary Management Challenges.
• Early management pioneers included Robert Owen (focused on human resources and worker welfare), Charles Babbage (focused on production efficiencies through division of labor), and others.

Classical Management Perspective

• Aspects include productivity and organizational performance.
• Scientific Management focused on improving individual worker performance, driven by labor shortages at the start of the 20th century.
• Four principles: developing scientific approaches for work, scientifically selecting, training, and developing workers, cooperating with workers to ensure job-plan alignment, and ensuring appropriate division of labor.
• Key figures: Frederick Taylor (replaced old work methods with scientific ones, eliminating "soldiering" and using time studies), Frank and Lillian Gilbreth (motion study techniques for eliminating inefficiency), Henry Gantt (Gantt charts for project management), Harrington Emerson (efficiency systems), and Henry Ford (mass production, assembly line, $5 daily wage, 8-hour workday).
• Classical Organization Theory (Administrative Management) focused on managing the entire organization, not individuals.
• Key figures: Henri Fayol, Max Weber, James Mooney, and Max Weber.

Classical Organization Theory

• Emphasized the perspective of senior managers.
• Key functions: planning, organizing, commanding, coordinating, and controlling.
• Key principles: division of labor, authority, discipline, unity of command, unity of direction, subordination of individual interests to the general interest, remuneration, centralization, scalar chain, order, equity, stability of tenure of personnel, initiative, and esprit de corps.

Scientific Management - Taylor

• Replaced old work methods with scientifically-based ones, eliminating "soldiering".

• Used time studies, standards planning, exception rule of management, slide-rules, instruction cards, and piece-work pay systems.

• Focused on worker selection, training, and development to improve efficiency.

• Key steps in Scientific Management (Taylor): Developing a science for each element of the job replacing old rule-of-thumb methods, scientifically selecting, training, and developing workers to do the job described, supervising workers to ensure they follow the prescribed methods, and continuing planning the work, but using workers to actually do the work

Scientific Management - Frank & Lillian Gilbreth

• Developed motion study and techniques to eliminate inefficiency.
• Frank Gilbreth reduced the number of movements in bricklaying, resulting in a 200% increase in output.
• Lillian Gilbreth made substantive contributions to industrial psychology and personnel management.

Scientific Management - Henry Gantt

• Introduced Gantt charts, a scheduling tool for projects.

Scientific Management - Harrington Emerson

• Implemented efficiency systems in companies, improving production routing, standardized conditions, time and motion studies, bonus plans, and raising worker wages accordingly.

Scientific Management - Henry Ford

• Focused on mass production, assembly lines, standardized products, $5 daily wage, and 8-hour workdays to increase productivity.

Fayol's 14 principles of Management.

• Key functions: planning, organizing, commanding, coordinating, and controlling,

• Key principles: division of labor, authority, discipline, unity of command, unity of direction, subordination of individual interests to the general interest, remuneration, centralization, scalar chain, order, equity, stability of tenure of personnel, initiative, and esprit de corps.

Behavioral Management Perspective

• Emphasized individual attitudes, behaviors, and group processes within workplaces.
• Key figures: Mary Parker Follett (focused on human behavior within workplaces and self-managed groups), Elton Mayo (Hawthorne Studies, confirming that worker behavior is impacted by social conditions), and others.

The Hawthorne Studies

• Conducted at Western Electric by Elton Mayo and associates from 1924/27 to 1932.
• Investigated the effects of workplace lighting on worker output.
• Revealed the importance of human behavior in workplace output and efficiency

Human Relations Movement

• The manager's concern for workers leads to increased worker satisfaction.
• Psychological and social aspects influence productivity

Maslow's Hierarchy of Needs

• Employees are motivated by a hierarchy of needs, beginning with basic physiological needs and progressing to self-actualization.

Organizational Behavior

• Studied management activities to promote employee effectiveness.
• Explored the complex nature of individual, group, and organizational processes.
• Key figures: Douglas McGregor (identified Theory X and Theory Y), Kurt Lewin, Chester Barnard, and Herbert Simon.

Quantitative Management Perspective

• Emerged during World War II to manage logistical problems.
• Focused on decision-making, economic effectiveness, mathematical models, and computers to solve quantitative problems.
• Utilized operations management and the field of “management science” (uses mathematical models/analysis to make the best decisions).

Integrating the Major Perspectives

• Emphasizes the importance of incorporating elements from various perspectives for effective management.
• The Systems Perspective (Open Systems): Views the organization as an interrelated system of elements functioning as a whole, with inputs being processes and outputs being released into the environment. Understanding of environmental influences.
• The Contingency Perspective: Recognizes that appropriate management behaviors depend on the specifics of the situation in the organization — this is unique to each specific organization.

Contemporary Management Challenges

• Acute labor shortages in high-tech sectors and an oversupply of less skilled labor.
• Increasing diversity and globalization of the workforce.
• Need for creating challenging and flexible work environments.
• Effects of information technology on work processes.
• Increasing globalization of product and service markets.
• Importance of ethics and social responsibility.
• Shift to a service-based economy.
• Impact of the coronavirus pandemic on management practices.